During a media briefing on the advancements in the collaboration between the government and business to boost economic growth, the Presidency underscored the goal of achieving 3% to 5% economic growth and generating 2.5 million jobs by 2030, despite the significant challenges faced by South Africa.
This goal seems unreachable after Statistics SA data on Tuesday released GDP data, which showed GDP only increased only 0.1% in the fourth quarter of 2023 over the previous three months, only narrowly avoiding technical recession.
However, logistics consultancy GAIN said yesterday that GDP last year would have been above 5% instead of the reported 0.6% if it did not have headwinds, such as logistics constraints that cost the country R1 billion per day, among other woes such as electricity.
There are three work streams that report to the Joint Strategic Oversight Committee with the National Energy Crisis Committee (Necom) focused on Eskom, the National Logistics Crisis Committee (NLCC) focused on Transnet and the Joint Initiative on Crime and Corruption (JICC) focused on crime and corruption.
The Presidency director general Phindile Bulani said real progress had been made in each focal area.
In the case of energy, Necom had unlocked 3 500 Megawatts (MW) of grid capacity, while request for proposals for 5 000MW of renewable energy, 2 000MW of gas-to- power and 600MW of battery storage had been issued.
In particular, Rudi Dicks, the Head of the Project Management Office in the Private Office of the Presidency, noted that there had been a 66% reduction in the severity of load shedding in the past 12 weeks compared with the same period a year ago.
There had also been progress on institutional arrangements with a separate transmission company with its own board being established and a new CEO, Dan Marokane, who started on March 1.
The private sector engagement with Eskom had resulted in 29 businesses signing up to support the entity, with 17 already intervening at power stations, he said.
This had resulted in 75 experts helping out and advising with no cost to Eskom.
Going forward, Dicks said Eskom would prioritise interventions identified by the German experts into power station performance. These interventions would be implemented from next month.
In April, Eskom would ensure that there was sufficient grid capacity for Bid Window 7, while it would release the final version of the Grid Capacity Allocation Rules.
In terms of logistics, Mxolisi Mgojo, the president of Business Unity South Africa (Busa), said there would be R700 million invested in key rail corridors while the National Treasury had provided a R47 billion guarantee to Transnet.
There had also been permanent appointments at Transnet’s top management - with Michelle Phillips appointed as the CEO and Nosipho Maphumulo as chief financial officer. Their business expertise had been mobilised to improve operational efficiency.
The net result was that Transnet aimed to move 190 million tons (Mt) in 2024/25 from only 149.5 Mt in 2022/23, but still well below the 226 Mt achieved in 2017/18.
In terms of ports, 63 vessels were reported to be waiting for berthing off Durban, but this had been reduced by 45% since then.
Transnet’s own 18-month turnaround plan, which was made public in October, seemed to have had the desired effect with morale improving and visible progress at ports. Refurbished cargo handling equipment has been landed in Durban and Cape Town, with shifts operating 24-hours a day in Durban and staff being upskilled with help from the University of Pretoria.
Coal exporters have agreed to fund spare parts for locomotives on the Northern Corridor (Witbank-Richards Bay), while the port of Durban has arranged more tug capacity, Mgojo said.
In terms of crime and corruption, Lt General Godfrey Lebeya said there had been a 65% reduction in “security incidents” on Transnet’s coal line, while R57 million had been allocated to set up a forensics analysis centre with experts seconded by business.
In response to a question on convictions, the Presidency said three people had been convicted with regard to the looting of the VBS Mutual Bank while a further 35 had been arrested.
With regard to grey listing, Martin Kingston, the chairman of Business for South Africa (B4SA), said this was front of mind and he was hopeful that South Africa would exit grey listing next year.
BUSINESS REPORT