Network - The Mercury - KZN - 25 November 2022

After 20 years in business, SLG looks ahead to new opportunities

YOGASHEN PILLAY yogashen.pillay@inl.co.za

SPRING Light Gas (SLG) celebrated its 20th anniversary in October as one of the leading natural gas suppliers in South Africa.

Group CEO Mzi Tyhokolo said among the company’s secrets to success was its strong relationship with custom ers, which it had built over the years.

Natural gas has many uses, Tyhokolo noted.

“Our focus area is industrial custom ers. We supply gas only to industrial customers, these are people who pro duce products from the gas. Industrial customers have the capacity to buy the gas in large volumes,” he said.

“When you buy bread, gas is used in the process baking, when you buy a plastic bottle of water gas is used in the process to manufacture PET. The textile industry uses natural gas to treat the dyes and material that are used.

“Everyday in your life you touch a product that uses natural gas in the process of its manufacture. An aerosol can which has sanitiser uses natural gas to make the can. Natural gas is also used in the baking process.”

Over the next three years, SLG has a strong plan to grow its market share by 50%, Tyhokolo said.

“We want to diversify the business of SLG, we want to remain in the energy space but we effectively want to diver sify our energy supply offering and go into what we call embedded power generation,” he added.

“For our industrial customers we know that we might have gas available in the pipeline but they might have an electricity shortage to make a product so we want to address that and supply both gas and electricity.

“That is something we are looking at going into for the next three years and are very hard at work at it.”

Tyhokolo added that SLG was also looking at securing a new source of gas.

“South Africa is running out of gas. Sasol was being supplied gas from Mozambique but we know the supply is going to start declining around 2026 or 2027. We can't wait for that time. We need to secure a source of gas now,”

he said. “We are exploring new supply opportunities to sustain not only our selves but the natural gas industry in South Africa. We believe that natural gas is also needed for a stable electricity supply.”

He said the past 20 years had been good for the industry, but now there were challenges.

“We had gas piped from Mozam bique and it was being produced at Sasol in Secunda, the two sources of gas. Like I said the gas fields from Mozam bique are declining and then Sasol is facing a huge push back from its inter national and European customers about coal burning operations. With this zero carbon agenda, Sasol has to relook at how it uses its product.

“We are now looking at the issue of running out of gas so the next question is are we going to shut our industry down or find a different source of gas.

“Remember, natural gas is traded

around the world like crude oil, we don’t produce crude oil but we have diesel, petrol and paraffin.

“So we buy crude oil from around the world and to an extent we refine it here, the exact same thing needs to happen with gas. Gas is sold around the world as liquefied natural gas and that is the next source of gas for South Africa, it is not a question of maybe, it's a question of when.”

Tyhokolo said liquefied natural gas will have to be shipped to South African ports.

“We have six or seven ports around our coast and the liquefied natural gas will have to be offloaded strategically and will either be regasified back into pipelines or can be decanted into tank ers like fuel and trucked to points of use. That is really where the shift of natural gas will be.”

Speaking on the challenges facing the South African economy, he said

manufacturers were the first to suffer when there was no growth.

“In order for the economy to grow we need to be a productive economy, we need to make things. The only way to make products and if you look at the history of countries like America and China you need to have a stable energy supply,” he said.

We need to not focus on carbon reduction as South Africa. Africa con tributes less than 2% of carbon emis sions. What we need to focus on is producing electricity the cheapest way we can and that is electricity from coal. We need to fix the power plants that we have. We can write policies but if we don’t have a stable electricity system, we can’t grow the economy.

“Remember when we talk about the fourth industrial revolution whether it is electric cars, WiFi and new AI technology they all rely on a stable electricity supply.”

SLG a proudly South African company that provides high quality natural gas to industrial and commercial customers in KwaZulu-Natal and Gauteng.

Celebrating 20 years of supplying natural gas in South Africa.

SLG Group CEO Mzi Tyhokolo.

Unlocking KZN’s economic potential

them being the poor rail infrastructure.

THE KwaZulu-Natal provincial govern ment and the KZN Growth Coalition are steadfast in their belief that the prov ince’s economy, which was battered by the Covid-19 pandemic, the July unrest and this year’s floods, can be revived.

In her update on her first 100 days in office this week, Premier Nomusa DubeNcube said the government was focused on business retention and expansion strategies.

“We will ensure we create an environ ment conducive for investment and the government’s role is to ensure that local businesses benefit first.”

She said there had been significant progress in economic recovery, pointing to the reopening of the Toyota plant in Prospecton, which was ravaged by the floods in April, the R7.7billion upgrade and expansion project at Sappi Saiccor Mill and the R750 million investment by the Metair Group’s Hesto Harnesses, which manufactures wiring harnesses for the automotive industry.

“We also launched the Oceans uMh langa mixed development project in uMhlanga. The development boasts the Radisson Blu Hotel, a world-class shopping mall and luxury apartments.

“Oceans uMhlanga broader investment of R4.2bn has transformed the upmarket area of uMhlanga.”

She said there were several other pro jects in the pipeline which had the poten tial to create thousands of jobs.

Siboniso Duma, KZN MEC for Eco nomic Development, Tourism and Envi ronmental Affairs, said there were set to be significant infrastructure projects in the next few years.

These projects are aimed at creating the space for black entrepreneurs to grow their businesses and thrive.

“These projects will create employment opportunities, for instance in the Msinga area there is a school that will be con structed valued at R200m,” he said.

He said billion-rand projects were already under way in the province, includ ing the upgrading of key routes to accom

INVESTMENT PROJECTS IN THE PIPELINE

Sino Africa Gas

This entails manufacturing of food-grade carbon dioxide for the beverages sector. The R56m project will be in Newcastle at the Karbochem chemical complex and is expected to contribute a potential of 50 jobs.

CMT Global

A textile and apparel manufacturing facility at Ezakheni, valued at R390m, creating 1 650 jobs. The company is the largest vertically integrated textile manufacturing plant.

Estcourt Intermodal Terminal

A logistics park and an intermodal terminal at the old Masonite/ Evowood site in Estcourt. It is recognised as one of the

modate the increasing volumes of traffic.

“Sanral (SA National Roads Agency) will invest R3bn to expand Spaghetti Junc

official Transnet back-of-port facilities across the country and is valued at R1.2bn with a potential of 1 000 jobs to be created.

Zululami Coastal Residential Estate

The residential estate development by the Rowles Property Group in Ballito. The first phase of the project is worth R390m, creating 400 jobs.

Duzi Forestry – Plywood

Duzi Forest Engineers is the plywood- and veneer-manufacturing company. This project is valued at R104m and is in Ngome, AbaQulusi Local Municipality.

Watercrest Medical Centre of Excellence

A medical centre which will be comprised of 407 beds servicing acute, sub-acute, day care and psychiatric wards to be located in Hillcrest. This is a R1.5bn investment with an estimated 1 000 jobs.

tion,” he said.

He spoke of other challenges under mining the province’s economy, one of

“Richards Bay is the busiest port in the country and Durban has the biggest port. We have many trucks on the road, which have a damaging effect on our road infrastructure. The lifespan of our roads should be around 10 years, but because of the trucks, it is down to three or four years,” he said.

The real solution would be for Transnet to fix its rail infrastructure for both goods transport and commuter traffic, he said.

Duma said the economic development department was engaging with the KZN Growth Coalition to help identify black entrepreneurs who are looking for equity stakes and would be providing between R20m and R110m for this endeavour.

Moses Tembe, KwaZulu-Natal Growth Coalition co-chairperson, said the province could revive its economy provided there was a sense of commitment from all social partners on what needs to be done.

According to Tembe, there are a num ber of industries that KZN needs to con tinue tapping into, including:

¡ manufacturing and storage

¡ transport and logistics

¡ tourism.

“The ocean’s economy is our obvious selling point because it provides oppor tunities for trade, commerce as well as tourism,” said the businessman. For this to happen though, Tembe stressed, some fundamentals need to be addressed.

He said the efficiency of the Port of Durban needs attending to, pointing out how such a move could unlock economic activity.

While Durban is the main attraction to tourists, especially from overseas, the rest of the province still has a lot to offer. This, Tembe said, meant ensuring efficient infrastructure and an undisturbed supply of water and electricity.

He said safety was a key priority for attracting new investments. “No one would want to put their money where there is no stability,” Tembe said.

“KwaZulu-Natal is a rough diamond that needs polishing for everyone to appreciate its beauty, and all of us need to make an effort towards this.

“It can be done because all the tools are there,” Tembe said.

THAMI MAGUBANE, KHETHUKUTHULA XULU and SIBUSISO MBOTO

THE Durban beachfront promenade. The KwaZulu-Natal provincial government says it is confident that the province’s economy can be revived. | LEON LESTRADE African News Agency (ANA).

A closer look at the shipping industry

WHEN the Operation Phakisa Oceans Economy was launched in July 2014, it ushered in an era of great enthusiasm, and hope for our emerging businesses that have long been excluded from this very strategic industry.

However, as we fast-forward to the end of 2022, the hope remains but the enthusiasm has all but dwindled.

The promise of a R177 billion econ omy and more than 1 million jobs has not materialised. We can however count small wins like the development of a world-class Cruise Terminal in Durban.

Many young people have also been trained in professional and technical skills relevant to the maritime industry.

However, most of them remain unemployed or working in industries other than the maritime industry. Many Enterprise Development programmes were completed with participating grad uates looking forward to seeking their fortune in this industry, with naive optimism.

A concession was awarded for an Offshore Oil and Gas Hub that has yet to bear the fruits of its outcome.

There were many shipbuilding pro jects and upgrades of existing infrastruc ture but these projects would have been done in any event as they are critical to efficient operation of the port systems.

It becomes counter-productive for the private sector to perpetually criticise the lack of progress in the implemen

PRASHEEN MAHARAJ

tation of Operation Phakisa; it should become part of the solution through a close co-operative and collaborative partnership with the public sector.

A few weeks ago, I did a joint press conference with the mayor of the eThek wini Municipality, where we promised the municipality would work tirelessly to ensure Durban has a bumper festive holiday season by ensuring our beaches, which had high levels of E coli due to sewage leaks from waste water treat ment plants that were damaged in the floods, are clean and safe.

A member of the maritime business community has offered to support the municipality with their ship hull clean ing machine that can act as a temporary wastewater treatment plant that will clean the wastewater, while allowing the municipality to undertake repairs to existing waste water treatment plants.

It remains to be seen whether the municipality will accept this private

sector-driven solution to salvage our tourism industry.

The recent strike by Transnet employees also demonstrated how a close working relationship between the private sector and public sector can minimise economic damage.

It was the best communication and engagement process I’ve ever witnessed in my business career. It resulted not only in the private sector being willing to bring in financial support to Transnet to avoid a prolonged and costly strike, but in creative and innovative ideas from the private sector.

We cautiously welcome recent amendments to the Preferential Procurement Policy Framework Act (PPPFA) that takes away the burdens of subcontracting to SMMEs that only resulted in increasing the costs of provision of goods and services in the maritime industry.

Too often front companies were used that didn’t achieve the transforma tion objectives this endeavour sought to achieve.

In fact, it gave rise to illicit business forums that demanded 30% of con tracts at the expense of legitimate black owned SMMEs, who were marginalised.

We note with concern the removal of the local content clause in public pro curement as a result of this amendment. This has the potential to decimate the local manufacturing industry.

The PPPFA does however give

Bumper cruise season for South Africa

Mossel Bay and Cape Town.

OCTOBER saw an early start to the 2022/2023 cruise season for South Africa, with the port of Durban about to enjoy one of its best seasons yet in terms of not only the number of cruise ship calls, but the quality of many of the vessels.

About 240 cruise ship calls will be made to South African ports before the season ends in April next year. In that time, thousands of overseas visitors will enjoy the sights and sounds of South Africa, with visits to game reserves, scenic spots, beaches and other attrac tions close to the ports of Richards Bay, Durban, East London, Gqeberha,

In Durban, many of the ships will make use of the new KwaZulu Cruise Terminal, while others will berth at the T-Jetty when two cruise ships are in port at the same time.

Transnet National Ports Authority (TNPA) said it expected more tourists this season as global Covid-19 regula tions and restrictions have eased. Having said that, it is worth noting that in Aus tralia, a cruise ship with 4 600 passengers on board docked in Sydney with over 800 cases of Covid-19 on board.

The cruise companies take extraordi nary precautions, but this event shows risks remain when so many people con gregate in relatively confined spaces.

Richards Bay can look forward to 25 cruise ship calls, which includes several ships making multiple calls. Durban is the big winner in these stakes, with no fewer than 76 anticipated cruise ship calls, including multiple calls, such as those of the summer resident MSC Cruises vessel, MSC Orchestra.

Cape Town follows with 70 calls, of which a second MSC Cruises ship, MSC Sinfonia, will provide coastal cruises to Walvis Bay, while Gqeberha will have 34 ship calls, East London 18 and Mossel Bay 16.

The queen of the oceans, Cunard’s Queen Mary 2, will make an appearance after an absence of several years. She is due in Durban on April 3, 2023.

authorisation to the procuring entity to stipulate in the Request for Proposals Local Content and BBBEE conditions, but it’s not mandatory.

It therefore creates the opportunity for corrupt public sector employees to enter into relationships with unscru pulous local and international private sector organisations, to import capital goods from subsidised countries.

It is imperative that the Department of Trade, Industry and Competition and the Department of Transport play their oversight role to ensure local content is maximised.

I believe by fostering closer rela tionships between all stakeholders in the maritime value chain, we can bring in efficiency, lower the cost of doing business and present our country as a preferred investment destination and restore our positioning as the premier port city on the African continent.

In all of this, we need to leave no one behind, especially the emerging businesses and the well-trained mari time professionals who were sold the dream of Operation Phakisa and the Oceans Economy Master Plan.

Like those early explorers who left their countries in search of new lands and fortunes, and persevered despite many failures, so we too shall arrive at the promised land.

¡ Maharaj is the president of the Durban Chamber of Commerce and Industry

Other new faces for Durban include two Holland America ships, Zaandam, which arrived on November 20, and Zuiderdam, due on March 10, 2023.

Durban will receive 21 cruise ships in all, a record number for one season.

“The increase of passenger ships calling at our ports is based primarily on the fact that we are in the postCovid-19 phase,” said Captain Rufus Lekala, TNPA’s Chief Harbour Master.

TERRY HUTSON

THE MSC Orchestra. | Trevor Jones

NETWORK connects with ... Vivian Reddy

KIRU NAIDOO

“GIVE people world class and they will pay for it,” gushes property developer Vivian Reddy, looking out over the grand piazza of uMhlanga’s Oceans Mall.

Opening day saw over 36 000 people burst through its shopping boulevards. Our lunch rendezvous is the next day. The restaurants are chock-full. “Since breakfast,” croons the proprietor of the chic Olive & Oil.

Nick, the attentive waiter, is quick with the food orders. A seafood paella for him. Linguine with wild mushrooms and truffle for me. A bottle of still water at room temperature between us.

Reddy rattles off answers in rapidfire superlatives.

Did you interrupt history?

The story goes back to my early Boy Scout days but I’ll come back to that. Ratan Tata told me about his grandfather’s Taj Mahal Palace in Bombay.

He chaired the India-South Africa CEO Forum and I was the deputy. Back in the day, British-owned hotels had a sign: “No dogs and no Indians allowed”.

Jamsetji Tata’s revenge was to build a jewel superior to anything the British could dream. In the ’70s, beach hiking was big with Boy Scouts. We’d reach uMhlanga dying of thirst. Apartheid oppression saw to it that we could not even get a bottle of water out of the five-star hotels, let alone frolic or camp on the uMhlanga beach.

You were stung by that?

(Purses lips.) I was hurt but I was inspired. The Radisson Blu brings my pain and my pleasure full circle, like the Tatas. How many black people in South Africa own five-star hotels? We do. Our 23 000 working-class shareholders do.

Does Oceans have an edge on the competition?

It’s in the attention to detail, the overall African touch. The musallah in the mall and the hotel with 40% of our

rooms facing the Qiblah direction. Our Chinese visitors choose the Radisson as an act of patriotic affinity with the owners. The huge banqueting halls are ready for the big Indian weddings.

Economies are in turmoil. Are you a gambling man?

(He chuckles.) Fortune favours the brave. I must tell you about driving down to the Wild Coast when it was newly built. We would take a bottle of Fifth Avenue Cold Duck and joke about popping champagne at our own casino. My friends laughed at me, saying it will never happen. I learned from my meet ing with the astronaut, Neil Armstrong as a 16-year-old Boy Scout – if you can dream it you can achieve it.

Is there an enabling environ ment for investors in Durban, in KwaZulu-Natal?

Too much red tape! Look at the roads. They should have been completed long ago. Some departments in the city are sharp. Others are anti-development.

This project will put at least R130 million a year into the city’s cof fers. I applaud the GEPF (Government Employees Pension Fund) who control over R2.32 trillion and decided to invest in South Africa to create local jobs.

Is there a silver bullet for job creation?

Construction is the biggest job crea tor of any sector. Where there are cranes there are jobs.

Was everyone happy with this project?

There were 400 objections. And we

listened to them all. To please one of the objectors we moved the tower blocks 120m apart from the original design and ended up with a much better view of the sea!

(Pauses for air kisses and selfies with lunching ladies.)

Do you take an aerial view of the future?

I took the CEOs of some of the world’s biggest fashion brands up in a helicopter to gaze at the potential. When you have Gucci, Burberry, Dolce & Gabbana, big-spending tourists will follow.

What’s your biggest thrill?

New projects, I get bored easily. I want to make an impact all the time.

What are the three biggest trends for you right now?

Crypto in the casino industry. Tech is exploding all around. World-class design in everything because people first feast with their eyes before opening their wallets.

Reddy insists on paying for lunch. On our way out, a doormat is flipped over by the wind. He bends to turn it over. No job looks too big or too menial for a man who has interrupted history with his endless slate of iconic projects.

He points to the Real Housewives of Durban filming in a new salon and spa created by his wife, Sorisha Naidoo, at the ramp end of the Platinum Walk.

He’s a master publicist, figuring that the Showmax screening will carry the message of the Oceans to 200 countries.

BUSINESS tycoon and co-developer of the Oceans Mall, Vivian Reddy.

KZN Top Business Women 2022

Jennifer Reddy and Dr Dheepa Maharajh.

THE grand finale of KZN Top Business Women 2022 powered by DRG and BusinessFit SA was held on November 17 at the Coastlands uMhlanga Hotel and Convention Centre.

Pictures: Doctor Ngcobo African News Agency (ANA), Shane Doyle and Asante Solutions

Jacquie Bhana and Dr Mahesh Bhana.

Ofer Ardenbaum and Benita Ardenbaum.

Kreshan Reddy, Mantu Ncube and Esay Reddy.

Grant Adlam, Melloney Rijnvis, Daisy White and David White.

Carol Ofori, Lenore Goss Matjie, Dr Lungile Mhlongo, Claudette Sigamoney and Zanele Luvuno.

Nondumiso Mthwa and Thulasizwe Mthwa.

Monay Mouton, Heather Flack, Lyndall Moodley, and Desmond Moodley.

Jeanine Topping and Trevor Wishart.

Catrina King and Andy Armstrong.

Nureshka Viranna, Kasthuri Viranna, Jasmeena Shiba and Nayan Shiba.

Dennis Geach, Natalie Keegan, Anele Msweli and Kyle Watkins.

Pindiwe Filtane, Gabbey Malope and Sinqobile Khuluse.

Samantha Croft and Sean Müller.

Makhathini found a niche in making money out of waste

KHETHUKUTHULA XULU khethukuthula.xulu@inl.co.za

FINDING a niche market and sticking with it has proved to be the winning formula for Makhathini Medical Waste.

Founder and managing director Bonginkosi Makhathini said the idea for the medical-waste firm came about as he initially had a transport company which transported human specimens collected in clinics and hospitals to laboratories in KwaZulu-Natal (KZN).

Makhathini said after being in the collecting and transporting space for a while, he asked himself: “What happens to the human specimens after they are tested in the lab?”, and that is when Makhathini Medical Waste was born.

The waste management business is based in Cato Ridge. The firm also launched a new medical-waste treat ment facility earlier this year, and has a fleet of over 120 bakkies and trucks operating in KZN and Gauteng, Makhathini said he grew up with an entrepreneurial mindset as his father owned and ran a general dealership in Mafakatini, outside Pietermaritzburg.

“I grew up always wanting to become an entrepreneur, but after stud ying business administration I went to work in the banking sector before starting my first business.”

He said he left the sector to open a liquor store in Msinga at the age of 25, which failed.

He said he lost everything, even his family home when the business failed, as he had used it as collateral when he obtained a loan to start up.

“After losing everything, I took a break from business and applied for a job and was hired as a clerk, which gave me an opportunity to clear my head and think of ways to gain it all back.”

That was when Makhathini started his logistics company, NNK Logistics, which grew to become the wastemanagement firm it is today.

The 52-year-old said the medicalwaste industry was not an easy one to

5 TIPS FOR ENTREPRENEURS

business, they invest in what everyone else is doing, which may overpopulate certain fields, and that may put them at a disadvantage.

“I encourage black people to enter the business space but especially to find their niche markets.”

Makhathini said his trick to staying successful was to focus on one thing at a time before venturing into other things, and also being hands-on.

Mthofi Ndlovu.

Former teacher says people skills key to success

KHETHUKUTHULA XULU khethukuthula.xulu@inl.co.za

WITH more than 10 years in the funeral services industry, Mthofi Funeral Group has made a name for itself with its service and memorable tombstones.

Company founder Mthofi Ndlovu, 49, said it started out as a funeral par lour and had another section that dealt with tombstones, catering services and marquees. But to his surprise it became known for its tombstones.

Mthofi, a former teacher, said he always had a knack for business as he first ran a fish and chips enterprise before venturing into the funeral ser vices sector in 2010.

He said running the takeaway busi ness while still working a full-time job was hard and he found it easier to get into the funeral services sector because he could manage it while being employed.

get into as there was not a lot of trans formation in the industry.

He added that even now he felt that black people were still not well represented in the space.

Makhathini also attributed the lack of representation to the fact that black people sometimes fail to find a niche or target unique markets.

“I believe that in most cases, black people follow a trend when going into

“On top of being hands-on, every entrepreneur must believe in their prod uct and invest in their business, first by ploughing profits into growing the business.

“Minimise your costs to maximise your profits,” he said.

The businessman emphasised that failing was also vital to succeeding in business, as it was the only way to learn.

“If my liquor store business had suc ceeded, I wouldn’t have learnt or grown to be the businessman I am today, and I wouldn’t have heeded the call from God to start this business.”

Strong appetite for investment property

AS LENDING conditions in South Afri ca’s housing market remain favourable - with competitive average concessions relative to prime, and rising mortgage approval rates - applications for invest ment or buy-to-let properties have rebounded strongly since late-2021, rising to 8.1% of total applications according to bond originator, ooba.

Coupled with this, and according to ooba statistics, the approval rate for 100% bonds remains buoyant at 84.7 in October, remaining above 84% for the third consecutive month, at a level which was last briefly recorded in late-2021.

These positive indicators reflect consumers’ sustained appetite for home ownership and investment in residential property, which is very encouraging particularly when seen against the backdrop of ongoing global and local economic challenges.

In addition, the percentage of sellers upgrading remained surprisingly high,

GRETA DANIEL

given the current economic scenario, at an estimated 13% of all Q3 sales.” (Source: FNB Estate Agent Survey).

Another interesting trend which is contributing to steady activity in the residential property marketplace is the movement of people within South Africa – including ongoing semigration - which surged in Q3, rising to a record high of 14% of reasons for selling according to FNB.

In recent years we’ve seen home buyers from other provinces, most notably Gauteng, semigrate to uMh

langa and other areas of the burgeoning KwaZulu-Natal North Coast, as well as the affordably priced KZN South Coast. The KZN lifestyle is highly sought after with an idyllic year-round climate and excellent schools.

Demand for North Coast proper ties is driven by the area’s convenient location, infrastructure and long-term investment potential, and is being fuelled by both local buyers and upcountry investors as well as some foreign interest.

With easy access to King Shaka International Airport and key arterial routes in and out of the Durban area and surrounds, uMhlanga and nearby Sibaya are ideally placed to attract out of town investors as well as buyers looking to relocate permanently to this highly appealing node. uMhlanga is short drive to the airport, making it appealing to Gautengers who have opted to enjoy a coastal lifestyle.

Although national house price

Originally from Greytown, Mthofi left his job to pursue the business fulltime, with the support of his wife.

The uMlazi-based entrepreneur said he attributed his success as an entre preneur to his teaching days when he learnt important people skills.

“What makes me successful is that I work well with my employees, I have 46 staff members, we understand each other well. I also network a lot.”

Mthofi said he is passionate about empowering unemployed youth.

“Most of my staff are young black males. The work is very labour-in tensive, I have mechanics, installers, machine operators and truck drivers.”

inflation continues to ease, the pace of this is slowing, suggesting that a lower turning point may be approaching. Coastal (within 5km of the coastline) property prices continue to accelerate, rising by +8.6% in June 2022 (lat est available data), while non-coastal eased to +4.2%, which means that the coastal price premium widened to +4.4% which is the highest since mid2005, according to Lightstone.

Also of interest is that the Covid-in duced boom in freehold price infla tion continues to fade, with the gap between freehold and sectional title, which peaked at 4.0% in mid-2021, narrowing to 1.5% in September 2022.

(Source: Lightstone)

Greta Daniel is national sales & operations manager for Pam Golding Franchise Services. For further information contact Pam Golding Properties email headoffice@pamgolding. co.za or visit www.pamgolding.co.za

BONGINKOSI Makhathini, founder and owner of Makhathini Medical Waste in Cato Ridge.

| DOCTOR NGCOBO African News Agency (ANA)

Digitising Durban for looming Metaverse

KYLE VENKTESS

A LOCAL company is taking the authentic Durban experience to any one in the world – from the comfort of their couch.

While virtual reality (VR) has been a buzzword in the tech industry for several years, the technology has sprung into the spotlight in recent months, given that it is set to become a strong component of the looming digital world – through the Metaverse.

A local software company, Virtual Reality Durban, has already begun digit ising the city by offering authentic local experiences through the power of VR.

Virtual Reality Durban is the brain

INNOVATORS

child of a VR veteran with over 20 years of industry experience, Gerald Ferreira, who told Network the technology is set to disrupt various industries by allowing the simulation of real scenarios.

“In theory, VR can simulate indus tries such as manufacturing, where automation machines can be built and trialled without having to be built phys ically. Faults can be stumbled upon so engineers can skip this process.”

To date, Virtual Reality Durban has digitally recreated highlights of the province, including the Reed dance, a zipline tour in the Drakensberg, a surfing experience on one of the city’s beaches and an aerial tour of King Shaka International Airport.

Making their mark with winning ideas

KHETHUKUTHULA XULU khethukuthula.xulu@inl.co.za

TACKLING everyday problems was the aim of young KwaZulu-Natal entrepre neurs who were recently awarded for their creative business ideas.

Three young innovators received awards at the Inkunzi’isematholeni in Business Awards ceremony held last month. The awards were established by the Ithala Development Finance Corporation (IDFC).

IDFC Group CEO Pearl Bengu said the programme promoted innovative business thinking among KZN youth with regards to identifying gaps in the market and developing new concepts in the green economy.

“This is to ensure that youth come up with sustainable business concepts which promote a holistic view of busi ness by looking after profits, people and natural resources. This initiative pro vides incubation and start-up support in their journey to becoming seasoned entrepreneurs.”

The winning concept for this year came from Ntando Ndimande, 24, of SkyHigh Innovations. He created a smart tap which will help people save litres of water. The prototype has been tested in four of Durban’s top restau rants in the Florida Road precinct.

Ndimande said the product contrib uted to environmental sustainability as the tap saved up to 74% of water.

“With the recent Covid-19 pan demic highlighting the importance of hygiene, instead of having to use your hands to open and close taps you can use your foot, which optimises clean liness.”

FACTS AND FIGURES

How VR works While still in its infancy, the versatility of VR paves a bright future for the adoption of the technology, with scores of applications set to disrupt various industries. At present, the technology is very simple, with users being able to experience VR via smartphone by either scrolling through the virtual layout using their fingertips or through motion by moving the device around in a room. VR users can then view virtual recreations of landscapes and experiences like those offered by Virtual Reality Durban. More advanced use of the technology is experienced through VR headsets for smartphones and gaming, which form the initial ways VR will take users into the Metaverse. VR and the Metaverse Set to be the next step in the evolution of social networking, the Metaverse is being strongly

driven by the parent company of Facebook, Instagram and WhatsApp – Meta. While a fairly new concept, a study into the country’s current social networking trends – the SA Social Media Landscape Report 2022 by Ornico Group and World Wide Worx – reported that in 2021, 16.1% of adult South Africans accessed some form of a “metaverse” or virtual world, with gaming being the main driver.

Potential in VR

With the Metaverse set to bolster the use of VR, its applications are already being applied to various industries. Ronald Ravel, South Africa B2B director at laptop manufacturer Dynabook, said the future manufacturing businesses could expect to see efficiency gains over the next five years. “With assisted/augmented (AR) and VR technologies making inroads into the market, manufacturers are finding ways of incorporating it into their everyday practices,” Ravel said.

The runner-ups were 29-year-old Nomandla Ngcoya from Pietermaritz burg and 28-year-old Sameer Khan from Reservoir Hills.

Second runner-up Ngcoya had the idea to commercialise traditional med icine. Ngcoya, who is doing her PhD in traditional medicine, said she came up with the idea when she saw a diabetes patient who had wanted to also use traditional medicine but had issues with using it in concurrence with western medicine.

“Traditional medicine is normally bitter and directions for dosages are usually measured in cups, and that in

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most cases leads to patients taking the wrong dosages.”

She therefore came up with the idea to have traditional medicine available in a capsule form so it can be easily administered and managed.

First runner-up, Khan, a biotech nology Masters student, said he hoped his energy-generating device would assist South Africans during electricity outages.

He said the idea came to him when he saw birds finding water from air conditioner drippings. He created a device that could generate energy from harvested waste water.

The CGT trap: where a trust is a beneficiary of a trust

The Thistle Trust is a beneficiary of various vesting trusts (“Tier 1 Trusts”) that conduct the business of property owners and developers.

The Tier 1 Trusts disposed of cer tain capital assets and distributed the capital gains in the same tax period to its beneficiaries, which included the Thistle Trust.

The Thistle Trust, in turn, during the same tax period distributed the amounts it received to its beneficiaries. The Thistle Trust, applying the con duit principle, treated the amounts it received as taxable in the hands of its beneficiaries.

SARS raised additional assessments taxing the distributions in the hands of the Thistle Trust and not its bene ficiaries. The tax court set aside these assessments finding that the amounts distributed fell within section 25B and Paragraph 80(2) of the 8 th Schedule of the Income Tax Act.

SARS thereafter appealed to the Supreme Court of Appeal (SCA) who

GRAEME PALMER

were tasked with determining whether the capital gains were taxable in the hands of the Thistle Trust or its ben eficiaries.

The SCA held that the Tax Court was wrong in applying section 25B as that provision applied only to the tax ation of income that accrues to a trust or its beneficiaries. Paragraph 80(2) was the correct provision to apply to the taxation of capital gains distribu tions from trusts.

The Tier 1 Trusts vested the cap ital gains in the Thistle Trust, which accordingly held a vested right to the

capital gains. The distribution of the gains to the Thistle Trust resulted in it receiving the gains as of right.

However, the SCA pointed out that the Thistle Trust did not dispose of any capital asset nor determine a capital gain that was distributed to its beneficiaries.

Paragraph 80 requires a trust to ‘determine a capital gain’ before the conduit principle can apply. Instead, the Thistle Trust distributed monies that had vested in it as of right.

Therefore, the SCA held that the capital gains were taxable in the This

tle Trust and not its beneficiaries.

An advantage of distributing cap ital gains to natural persons who are trust beneficiaries is that the gains will be taxed at a lower effective rate (i.e., 0 -18%) than if they were taxed in the trust itself (i.e., 36%).

Trusts that have trusts as benefi ciaries must be careful not to fall into the same tax trap as the Thistle Trust.

Once a trust disposes of a capital asset and distributes the capital gain to another trust that capital gain will become taxable in that trust.

This article has been written by Graeme Palmer, a Director in the Corporate & Commercial Department of Garlicke & Bousfield Inc. For more information contact Graeme on telephone: +27 31 570 5496, email: graeme.palmer@gb.co. za

■ NOTE: This information should not be regarded as legal advice and is merely provided for information purposes on various aspects of tax law.

ITHALA Development Finance Corporation (IDFC) board chairperson Sihle Mkhize, IDFC Group CEO Pearl Bengu, winners of the Inkunzi’isematholeni Youth in Business Awards Ayanda Bhengu and Ntando Ndimande, MEC for Economic Development Siboniso Duma and eThekwini councillor Nkosenhle Madlala. | DOCTOR NGCOBO African News Agency (ANA)

Nomandla Ngcoya

Sameer Khan

Donald Mokgale and Kabelo Ringane, Puns & Things.

Lenore Goss Matjie and Neville Matjie, CEO Trade & Investment Kwazulu-Natal.

Deon Dhlomo, chairperson of the SLG board, directors Bekithemba Moyo, Kgotlelelo Rantloane, Mamedupi Matsipa and Tshakalisa Matiwaza.

Mzi Tyhokolo, SLG Group CEO, councillor Busi Ndlovu of the Economic Development Committee, eThekwini Municipality, and Nicolette Mothilal, SLG Group chief financial officer.

Shawn and Ezelle Saunders.

Fundile Mazinyo and Vanessa Marawa.

Donovan and Hazel Chimhandamba.

Thuthuka Mbatha and Predashnee Govindsamy.

| KHAYA NGWENYA African News Agency (ANA) and SUPPLIED

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SLG was privileged to officially open a secondary school’s science laboratory and computer classroom, which had been rebuilt by SLG’s enterprise development partners.

RECEIVING various laboratory furniture and portable science kits in order to achieve the best academic results.

AS PART of Mandela Month activities, SLG staff were honoured to spend time at a children’s home in Cottonlands, Verulam.

SUPPLIER Development Program successfully completed! The community development partnerships are a cornerstone of SLG’s transformation agenda.

AS PART of SLG’s math and science capacity-building campaign, the School for the Hearing Impaired received science furniture and various science portable kits.