SA Business Integrator - Volume 9 l Issue 1

A new year generally implies a fresh start. There are new recruits (graduates), people have changed jobs or joined new industries, and people are more energised after a holiday break.

That being said, it’s been a challenging few years for many businesses, and there has also been some political turbulence and ongoing load-shedding, as witnessed towards the end of 2022.

As 2023 kicks-off it is imperative that businesses continue on the path of flexibility – realistically loadshedding is now a norm in South Africa, and we have to be smart to ensure that we all have plans in place to help mitigate this.

But it’s not just about load-shedding – people have changed, and business has to be sensitive to this. Employers need to be flexible with employees if they want to ensure retention.

Many businesses had not fully recovered from the pandemic before load-shedding returned with a vengeance. Added to this, the cost of living has increased dramatically. Unemployment remains a serious concern, however, employees seem to be more aware than ever before of their mental health and needs, such as growth and study opportunities.

If businesses are inflexible, this could negatively impact growth prospects. I think that 2023 could be a year of opportunity, but we have to be cognizant of the realities. Looking around and having engaged with many people, when I sit back I realise that we have incredible talent in our country. South Africans are smart, resilient and innovative, but they just need the platforms and opprtunities to thrive.

Wishing you and your teams a prosperous year of growth and innovation!

52 Advertorial – Atlantis SEZ: Atlantis SEZ driving sustainable development and job creation 56 Sustainable short sea shipping – the way forward for SADC 58 6 ways to maximise ROI with real-time transport visibility

Unpacking SA’s agri international free trade agreements 68 Food: inflation, security and the gathering storm 72 Expropriation Bill will kill the necessary business of land speculation 74 SA’s shift to renewable energy must include plans for waste disposal 76 An alternative hydrogen beneficiation pathway 78 Dynamics of the local energy market and JUST transition 82 Mining companies need to adapt to a greener economy 86 Economic progress versus carbon footprints 90 Future technologies driving the mining industry 94 Promoting sustainable opportunities linked to mining

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PUBLISHER

Elroy van Heerden-Mays elroy@mediaxpose.co.za

EDITOR

Tashne Singh editor@sabusinessintegrator.co.za

SUB-EDITOR

Tessa O’Hara tessa.ohara@gmail.com

CONTENT MANAGER

Wadoeda Adams artwork@mediaxpose.co.za

DESIGNERS

Anja Bramley artwork1@mediaxpose.co.za Shaun van Heerden-Mays artwork2@mediaxpose.co.za

EDITORIAL CONTRIBUTORS

Dirk Mostert Dr Christie Viljoen Elisha Bhugwandeen Daryl Dingley Matone Ditlhake Linda Page Stephen Rushton Mpiyakhe Dhlamini

Aradhna Pandarum

Nirvasha Singh

Carryn Alexander

Jaqui Pinto

Giada Masina

Garyn Rapson

Lizle Louw Garth Zietsman

ADVERTISING SALES MANAGER

Rashieda Wyngaardt rashieda@sabusinessintegrator.co.za

ADVERTISING SALES Hester Kleynhans hester@mediaxpose.co.za

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DIGITAL MARKETING MANAGER Jay-Dee van Rensburg digital@mediaxpose.co.za

SOCIAL MEDIA CO-ORDINATORS

Kyla van Heerden social@mediaxpose.co.za Ketsia Makola ketsia@mediaxpose.co.za

DISTRIBUTION & SUBSCRIPTIONS

Shihaam Gyer distribution@mediaxpose.co.za Sherwin Kastoor sherwin@mediaxpose.co.za

CHIEF FINANCIAL OFFICER

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WEBSITE DEVELOPER/ADMINISTRATOR

Justin McGregor justin@mediaxpose.co.za

RECEPTION

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Reinventing the African hospitality sector

The iconic 5-Star Cape Grace Hotel (Cape Town, Western Cape), under new ownership and management, heralds positive investment for the sub-Saharan region. Leon Meyer, General Manager of Cape Grace Hotel shares some insights pertaining to this investment that will most certainly have a ripple effect in Cape Town and even beyond the borders of South Africa.

Unlocking opportunities to rise to even greater heights

“In 2022 the Cape Grace underwent an ownership and management change. Cape Grace was aquired by Kasada Capital Management, which is an independent investment platform within the

Kasada Group, dedicated to hospitality in subSaharan Africa. The firm was launched in 2018 with the backing of Qatar Investment Authority, the sovereign wealth fund of the State of Qatar, and Accor, a world leading augmented hospitality group,” says Leon Meyer, General Manager of Cape

Grace Hotel.

“While already an iconic fixture on the V&A Waterfront and having been voted as one of the ‘Top Luxury Hotels’ on the continent and the ‘Best City Hotel in Africa’, the new ownership brings about a new opportunity for Cape Grace to rise to even greater heights as a result of being the beneficiary of the Kasada Group’s and Accor’s expertise,” comments Meyer.

Daring reinvention to realise the vision

“Cape Town deserves a truly iconic luxury property and who better than Accor to achieve this in the light of their proven track record with other highend luxury hotel and hospitality brands such as Raffles, Fairmont Hotels and Resorts, Sofitel, Sofitel Grand, Orient Express & Emblems and Banyan Tree. The Group will strive to amplify luxury hotel experiences through a distinctive collection of unrivaled hotels under the Accor Luxury brands banner within the Western Cape and beyond,” says Meyer.

“Taking into account the bold vision the Kasada Group has for the region, the Accor Group is wellplaced as this kind of daring reinvention is part of the Accor DNA. For more than half a century, Accor has continuously been reinventing the hospitality business by making daring moves, challenging the status quo, and responding to global shifts as well as guests’ evolving needs. They do this through instilling the same values into the heart of the organisation and the more than 230 000 women and men who form part of its global reach. Accor works tirelessly to build a reputation as an employer of choice that empowers and supports its people. Team members at Cape Grace will benefit from the same philosophy that will cascade to all touchpoints. But they are not the only ones who will benefit. Accor’s business and performance are closely linked to those of its partners, the suppliers and owners of Accor establishments operated

under management and franchise contracts. This describes a wider arc of responsibility and commitment,” continues Meyer.

Embracing ESG values

Well-known for its tasteful elegance with regard to its aesthetic, Cape Grace is set to mark a new chapter in its history. “While being cognizant and staying true to the rich legacy, cultural essence and authenticity of Cape Grace, we will be undertaking certain renovations with the view of obtaining the EDGE green-building certification,” says Meyer.

According to Olivier Granet, Kasada's Managing Partner and CEO of Kasada Group, "Our value creation strategy will be driven by our sustainability values and highest ESG standards for the benefit of our guests, employees and local communities."

Meyer adds, “The Accor Group is committed to guaranteeing not only a quality offering and worldclass service but also a high environmental and social ethic, constantly forging strong bonds around sustainable development issues so that guests can enjoy a more responsible hotel experience. Zero carbon, zero waste, recycling, and controlled water consumption are just a few of the targets that Accor has set for all its properties. While there are changes planned, these seek to enhance and do not detract from our commitment to luxury and the ultimate guest experience.”

Challenges, lessons learned and looking ahead

Reflecting on the challenges of the past few years, Meyer notes that the Covid-19 pandemic left deep scars on the industry, which is now perceived as an ‘unreliable’ sector for employment or career prospects.

He comments, “Looking at the impact, some hotels had to open in phases due to the lack of business demand or having been reliant on international travellers who are not yet back travelling

to long-haul destinations. Globally our clients have been disrupted and the global cadence for travel is still in the process of being reset. Granted the view at the beginning of Covid-19 was a recovery in 2025 or beyond to 2019 levels. However, we have seen that around the world, holistically speaking, results in Q3 & Q4 2022 are better than 2019 – supported by a strong pipeline entering 2023.

“Liquidity presents itself as an immediate challenge for hotel owners and operators who remain laser-focused on understanding cash flow management and the importance of accurate forecasting. Realistically, the cost of running businesses remains eye-watering compared to just 3 years ago! The pressure that poor planning and government infrastructures place on business makes it challenging when one takes into consideration the increase in labour cost, fuel prices, basic food items and then the issues we are having with electricity supply and loadshedding daily.

“We also saw a shift in consumer behaviour –Covid-19 ushered in an unprecedented level of channel switching and brand loyalty disruption. In general terms 75% of consumers tried new shopping behaviours, with many of them citing convenience and value. A large percentage, mainly Gen Z and Millennials, deserted trusted brands for new ones. That means we as big hotel brands need to be relentless in making sure we communicate well to our younger consumers and underpin our hotel brands commitment to reflecting their values.

In conclusion, Meyer says, “As hotel leaders, we need to make sure that our hotels are known

for truly looking after our employees and that we are seen as an employer of choice. For me, this is a principle I will be focusing on at Cape Grace, and success will mean that we need to make sure we look after the local communities we serve, focusing on sustainability and our commitment to ESG and finding that sweet spot where we can be driven, successful in running our properties but importantly do so whilst having a lot of fun.” 

Cape Grace Awards

Consistently rated as one of the top hotels globally:

• Best Hotel in the World/World’s Best City Hotel/ Best Hotel Africa and the Middle East/ Best Hotel South Africa: Travel and Leisure Magazine’s World Travel Awards

• Best Hotel in the World/ Best Hotel in Africa: Conde Nast Traveller Awards

• 2nd Best Hotel in the World; Top Hotel with Exceptional Service in South Africa; Top luxury Hotel Africa; Top Hotel South Africa: Tripadvisor Travellers Choice Awards:

• Best Hotel in Africa & Indian Ocean: Ultratravel (US & UK Poll)

www.capegrace.com

City of Cape Town’s success due to resilience of people

and agility of businesses

What do you attribute Cape Town’s continued progressive economic growth to?

Cape Town’s success is due in large part to the resilience of our people and the agility of businesses in the region. Innovation is at the heart of everything we do. The City works hard to establish a collaborative, forward-looking environment where big companies, as well as entrepreneurs and small start-ups, thrive.

We’ve spent substantially on IT infrastructure, particularly the rollout of fibre-optic cable; have initiatives to make doing business in the city easier; and fund and promote skills development programmes.

One of our flagship projects is The Business Hub initiative, which provides practical solutions to simplify starting and developing a small business.

On a practical level, the metro’s physical infrastructure, stable government, and fibreoptic telecoms make it a sensible destination for businesses to establish their operations. International companies benefit from the large pool of available skilled professionals and the relatively low labour and living costs.

In addition, Cape Town is the only metro in the country able to protect City customers from up to two stages of Eskom load-shedding, a huge help

The City of Cape Town’s Mayoral Committee Member for Economic Growth, James Vos, talks to SA BUSINESS INTEGRATOR about current and future plans for the city.

for businesses. Between February and July 2022, the city protected its customers from 722 hours of load-shedding in total. To sustain this, we have also recently announced the construction of a solar megawatt plant in Atlantis, with more planned for other parts of the city.

How does tourism link in with driving other business growth opportunities?

Travel connects the world and through specific tourism markets, we are unlocking economic opportunities in the metro. We invest in platforms that increase our aviation profile because this is critical to international trade. For a similar reason, we work to raise Cape Town’s brand as a cruise destination because of the business it creates in terms of ship maintenance, the hospitality sector, and other downstream and upstream markets.

This is also the case for our MICE (meetings, incentives, conferences, and events) profile. Travellers might visit for the wines or the beaches, but investors stay for the opportunities. Through tourism, a local delicacy becomes a global trend; a design goes from Khayelitsha’s streets to London’s catwalks; or investors realising the potential of Atlantis’s green-tech developments, go from curious, to signing on the dotted line. Thus, more livelihoods are sustained.

We’ve worked hard to promote Cape Town as a world-leading city, and the perfect place to visit, live, work, study, play and invest – supporting a healthy work-life balance.

What is the City doing to enable SME growth in the tourism sector?

The City of Cape Town offers several programmes to support and encourage SME growth. One such support service is the City’s Business Hub, established to provide practical solutions to simplify starting and developing small businesses.

Through a single point of access, we help SMMEs to navigate various processes and reduce possible red tape they may encounter. We also host skills

development workshops for entrepreneurs across industries.

In addition, Cape Town Tourism, the City’s official destination marketing organisation, has rolled out a Neighbourhood Experience Development training manual to help guide SMEs in developing their businesses, and to encourage neighbourhood readiness for travellers. They also host regular workshops and networking sessions for their 1 000+ members. These platforms in turn help businesses to sustain and grow.

What do you feel are the major challenges from a tourism perspective?

Challenges on a global and macro-economic level include the geo-political situation in the Ukraine and the economic constraints in our key source markets due to rising fuel and energy prices.

Diminishing disposable income and the movement from long haul tourism purchases into a luxury purchase may dampen the demand in the short term.

Macro political challenges include the slow progress in terms of an e-Visa, as well as red tape hampering fast turnaround time on applications and approvals. On a micro level, our challenges are to ensure water and energy resilience.

To this end, the City has embarked on the rollout of an extensive Resilience Strategy to ensure that we achieve our growth and sustainability objectives. The strategy, developed in partnership with 100 Resilient Cities, was the outcome of significant engagement with stakeholders across Cape Town and followed an extensive resilience evaluation that attempted to identify the most critical vulnerabilities and the most relevant shocks.

Key opportunities are vested in property developments that range from hotel investments, both in management contracts and property acquisitions as well as new built properties.

With the increase in airlift and rapid growth in

the cruise industry, e.g., the bounce back postCovid currently surpassing 2019 peak season figures for 2022/23, affiliated services are unlocked in retail, freight forwarding and technical services.

Our events calendar is also picking up momentum and we see a keen interest in Cape Town for conventions and general business tourism. Our international airport also has an extensive expansion plan, and this brings about opportunities in construction and affiliated services.

What are some of the key sectors and projects in the pipeline that the City is pushing to usher in further development?

To ensure further development, the City has recently approved the Inclusive Economic Growth Strategy (IEGS) for Cape Town. This plan, which is a successor to the 2013 Economic Growth Strategy, will serve as the foundation on which the City will further develop the economic growth systems, and create economic opportunities for more citizens.

It recognises that Cape Town comprises diverse industries that provide a range of job and growth opportunities, from clothing and design, to call centres and green energy, marine manufacturing and information technology.

By collaborating with our many valued business partners to support and grow these industries, the City has secured billions of rands in investments, created employment opportunities for thousands of people, and helped to improve the prospects of thousands more through work readiness training. Through the IEGS, the City will expand on this work, and breathe more life into these and other economic growth and opportunity-creation mechanisms.

Ongoing initiatives include the Ease-of-doingbusiness Programme, which focuses on creating an enabling business environment; the Workforce Development Initiative, to create training and employment opportunities for Capetonians; and the Growth Coalitions Project.

There has been sustainable responsiveness calls for collaborative partnerships between all sectors – government, business, communities and academia in the form of growth coalitions within Cape Town’s most high-value industries. These structured and outcome-driven stakeholder engagements are critical for sharing knowledge, planning and implementing together, ensuring alignment for the realisation of growth opportunities and resolution of challenges.

One of the most important matters that I have advocated for is the reduction of red tape, which stifles foreign investment and growth of local businesses.

As part of our plan to drive foreign investment into Cape Town, the City has established a special Investment Facilitation Branch (IFB) within the Enterprise and Investment Department dedicated to helping businesses of different sizes, across industries, land and expand their operations in Cape Town.

Since its establishment in 2017, the branch has engaged hundreds of businesses and has assisted more than 20 companies, unlocked investments worth billions of rand and created thousands of job opportunities.

Tell us a bit about the City’s plans regarding renewable energy investment.

Our goal is to take full advantage of the solar and wind energy opportunity, while simultaneously empowering Capetonians with job and business opportunities in a market that is booming.

In the green-tech sector, the City works closely with partners such as the South Africa Renewable Energy Business Incubator (Sarebi) and the Atlantis Special Economic Zone Company (AsezCo) to enable small businesses and individuals with knowledge and skills to create meaningful opportunities in this market.

To what extent is Cape Town’s reputation as an investor-friendly city driving fintech?

Cape Town is home to Africa’s oldest tech incubator, the Cape Innovation and Technology Initiative (CiTi), through which over 3 000 entrepreneurs have been trained.

The City’s partnership with CiTi, the Western Cape Government, and Wesgro – the Trade and Investment Promotion Agency – has ensured over the years, that efforts to improve and strengthen the business environment produce the successes that are seen today.

It is by no accident that the Western Cape is home to 47% of South Africa’s tech start-ups.

Another important point to mention is that Cape Town accounts for 75% of South Africa’s venture capital deals – this is a clear indication that Cape Town is doing something right.

Maintaining current infrastructure and rolling out future projects, such as current efforts of reducing reliance on Eskom, make a great investment case for the region.

What are three key aspects to drive growth in the city?

During my time in government, I have learned that empathy, collaboration, innovation and consistency are key to growth.

With empathy, we listen to our communities so as to understand their needs and then respond to it. Through collaboration, we successfully enact programmes that drive change and empower people. With an innovative mindset, we can better respond to shocks and trends.

What does the future of Cape Town look like?

Our goal is to position Cape Town as the easiest place to do business in Africa. The City is committed to increasing jobs and investment in

the Cape Town economy by simplifying regulations and processes so that it is easy for businesses to start and grow.

We want to create an economy of hope and confidence in Cape Town. Our objective is not to compete with other municipalities, but to prove that it is possible to have a city in South Africa where anyone’s dreams of success can be realised. We have had numerous engagements with other municipalities, where we’ve shared ideas. We are working towards the same goal: a better South Africa for all who call her home.

I have to be a champion for Cape Town because of my job but engaging with people in every corner of this city makes me feel invigorated and I want to be a champion for Cape Town. The future of Cape Town is bright because we are making it so.

James Vos

James Vos is the Mayoral Committee Member for Economic Growth in the City of Cape Town. With a portfolio that covers matters of trade, tourism, investment, and business support, James heads up a team that is instrumental in driving meaningful economic opportunity in Cape Town.

During his time as a public representative, when he also served as a Ward Councillor, Member of Parliament and Shadow Minister of Tourism, James received numerous civic awards, including the International Merit Award.

He is also among the youngest public servants to receive the life title of Aldermanship. James believes that the most powerful instrument for improving the quality of life and create jobs is economic growth. To achieve this, his mission is to drive travel and trade to Cape Town and make the metro the easiest place to do business.

MANUFACTURING CITY

CAPE TOWN, WHERE GREEN ENERGY, MANUFACTURING AND SKILLS WORK TOGETHER.

Cape Town is an established manufacturing base, offering excellent transport connectivity and port infrastructure for exporting to the rest of Africa and beyond.

www.investcapetown.com

South African

economic outlook 2023

By Dirk Mostert and Dr Christie Viljoen of Strategy &, Part of the PwC Network

With global inflationary pressures and related headwinds expected to last into 2023, South Africa will need to focus its energy on the reforms that will allow our economy to become more productive and competitive.

Persistently high global inflation

The global macroeconomic environment continues to suffer under levels of inflation not witnessed in decades on the back of supply chain disruptions and reduced fiscal buffers. European countries, affected by the ongoing Russian invasion of Ukraine, are grappling with energy supply concerns as winter approaches. These inflated energy prices could also pass through to non-energy prices, especially food. Indeed, Russia’s announcement on 29 October to suspend their participation in the United Nations-brokered grain export treaty via the Black Sea corridor and their subsequent reversal of this decision four days later highlights the uncertainty around food security that will likely fuel inflation further.

Rising interest rates and investment outflows

To counter persistent inflation, key central banks including the US Federal Reserve, the Bank of England, and the European Central Bank had to aggressively raise interest rates during the course of 2022. The current outlook is for these policy rate increases to continue, then to peak during the first quarter of 2023 and, once inflation eases off, to decrease to 2.0%-2.5% towards the end of 2024.

Conversely, developing economies like South Africa have seen investment outflows due to the reduced interest rate yield spreads.

Amid these uncertain times and attractive interest rates from a riskreward perspective, the US dollar has been the beneficiary of investor flight to safety, trading at parity with the euro since 11 July. Conversely, developing economies like South Africa have seen investment outflows due to the reduced interest rate yield spreads.

Economic growth and commodity prices

Globally, the cost-of-living crisis under these tightening financial conditions is pressuring households and consumers, negatively affecting their overall demand, ability to service mortgage debts as well as their levels of savings.

The next two quarters could potentially see recessions in Europe, the US, Canada, and some economies in Latin America. China faces a property market downturn and a slowdown in their manufacturing and service sectors.

However, Asia Pacific, the Middle East, and Africa are expected to show modest growth during this period, which could avoid a global downturn in 2023. The International Monetary Fund’s (IMF) October world economic outlook growth projections indicate a real GDP growth rate of 3.2% in 2022 followed by a 2.7% growth rate in the year thereafter.

Commodity prices

As the global growth slowdown intensifies, commodity prices are expected to ease in the next two years, but they will remain considerably above their average over the past five years. The uncertainties around the war in Ukraine leave ample room for further supply-side shocks and subsequent commodity price volatility.

Impact on South Africa

South Africa is widely expected to achieve a real GDP growth rate of approximately 2% in 2022. However, the global macroeconomic environment has led to exchange rate weakness of the local currency and higher interest rates. These headwinds, coupled with South Africa’s local, structural challenges – with electricity supply disruptions arguably being chief among them – mean that economic growth in 2023 could be curbed to 1.5%.

The projected reduction in global growth over the next couple of quarters could allow supply

chain pressures to ease somewhat and aid the expectation of a deceleration in inflationary pressures into 2023.

Expectations are that South Africa will record an average headline inflation rate of 6.8% in 2022, returning to around 5.1% in 2023. Similar to the global trend, the Reserve Bank’s Monetary Policy Committee (MPC) is expected to raise interest rates further by 50 basis points to 6.75% on 24 November and another 50 basis points to 7.25% in 22Q1, before allowing the rate to subside to 7% by 22Q4.

South Africa’s outlook – factors that we can influence Notwithstanding the global economic outlook, South Africa needs to address a number of local challenges to improve productivity and global competitiveness to unlock economic growth and job creation opportunities.

Failing this, the risk faced by South Africa at present is that the breakdown in social cohesion experienced in recent years continues on a negative trend over the short- to mediumterm. For private companies, this increases operational and security risk for business activities.

Minister of Finance, Enoch Godongwana, delivered the Medium-Term Budget Policy Statement (MTBPS) in Parliament on 26 October. On a positive note, revenue collection exceeded projections across most tax categories and disciplined budgeting and high commodity prices allowed the budget deficit to narrow from 5.5% in February to 4.9%.

The country’s debt burden remains substantial, having increased sevenfold from R577 billion in 2007/08 to over R4 trillion in 2021/22. However, a primary budget surplus of 0.7% of GDP is projected for 2023/24 and net government debt is expected to stabilise at 69% of GDP in 2024/25.

6 key challenges to the country’s economic and fiscal sustainability

PwC highlighted six key challenges to the country’s economic and fiscal sustainability:

A transfer of Eskom’s debt to the sovereign balance sheet

The National Treasury plans to transfer between a third and two-thirds of Eskom’s R400 billion debt to ensure the power utility becomes financially stable. While the relevant debt instruments and method of implementing the relief are not yet finalised, Finance Minister Enoch Godongwana’s comments have led Moody’s Investor Services to confirm on 1 November a change to their outlook for Eskom from negative to positive. More detail will be provided in the annual budget during February 2023.

Actions to avoid Financial Action Task Force (FATF) grey listing

The National Treasury took a leading role over the past 12 months in finding answers to the FATF grey listing risk. The Finance Minister said the state is “doing everything necessary” to prevent the grey listing.

This includes two bills tabled to parliament to address weaknesses in the legislative framework which are expected to be passed by the end of this year. However, the MTBPS did not comment on the fact that in-progress legislation will likely not count towards the progress report that South Africa needs to provide the FATF in November 2022. In other words, the key legislative changes needed to avoid grey listing might be approved too late to succeed in this endeavour.

Lullu Krugel, PwC South Africa Chief Economist, says: “If grey listed, South Africa would see its private sector endure increased international transactional and compliance costs. Research by the IMF shows that in the 89 emerging and developing countries grey listed during 2000-2017, this resulted in a drop in capital flows equal to 7.6% of GDP over a period of nine months. This would result in negative pressure on the rand exchange rate, higher import inflation, and possibly additional interest rate increases.”

However, the National Treasury’s sense of urgency is a positive step in achieving critical reforms to curb corruption in South Africa.

Clearing the backlog in processing critical skills visas

While most foreign-owned firms in South Africa have a majority of local representation among their staff, their operations are frequently dependent on the presence of foreign nationals in key positions. Foreign-owned firms have voiced their frustration with the current delays in getting these visas approved.

The importance of skilled workers for business performance and economic growth has been highlighter before. However, the MTBPS did not address the delays in processing the applications, which we hoped would be supported with additional finance and human resource capacity.

A framework for a comprehensive social security system

The Finance Minister indicated in September that the MTBPS was likely to contain some comments about income support as part of a larger framework for a comprehensive social security plan. For now, the temporary R350 COVID-19 Social Relief of Distress (SRD) grant was extended for another year (to

March 2024) as the National Treasury continues to look at how a possible permanent extension thereof can be financed.

This would require increased fiscal revenue, reduced spending elsewhere, or a combination of the two. The MTBPS did not elaborate on progress in fleshing out the details of the comprehensive social security plan.

Management of the public wage bill

The MTBPS was expected to firmly reiterate that the government is not reneging on its pledge to reduce the pressure exerted on the budget by remuneration costs. Indeed, the Finance Minister pencilled in a 3% increase for public servants. The increment is notably lower than what labour unions are currently asking for.

At the time of writing, the Public Servants Association has indicated that members will embark on a strike on 10 November that will affect the activities of government departments, especially home affairs and transport. Further strike action by other associations remains a possibility.

It is worth noting that the levels of inequality in South Africa leave large numbers of communities reliant on critical state-funded services. To this end, as per the MTBPS, education, health and social development will receive the lion's share of the R3.56 trillion social wage over the next three years.

Progress with the Infrastructure Fund pipeline

February 2022 saw the last substantive update on project feasibility for the government’s keystone infrastructure endeavour aimed at crowding-in private investment into major infrastructure projects.

While Minister Godongwana noted that the government is still committed to crowding-in private investment into the delivery of public sector infrastructure, the MTBPS document provided no substantive update about the pipeline of projects.

It also highlighted a likely R4.2 billion in unspent allocations to the Infrastructure Fund during the current fiscal year. On a positive note, the National Treasury recommitted to allocating R100 billion to the fund over 10 years. Given the country’s electricity generation and water distribution infrastructure inefficiencies, one should expect large allocations to bolster supply in these two critical areas.

The Presidency published an investment plan on 4 November providing more details on how they intend to allocate the US$8.5 billion (over R150 billion), pledged by the US, the UK, the European Union, Germany and France at 2021’s United Nations-led climate talks (more commonly referred to as COP26).

Over the next five years, R136 billion will be invested in electricity infrastructure, R12.5 billion in developing green-hydrogen projects, and R3.5 billion in the electric-vehicle industry.

Finally, to this list of six, we also add consideration for the Just Energy Transition. With the 2022 United Nations Climate Change Conference (COP27) ongoing, there is a keen focus on any official statements that could provide more detail on this topic.

Climate risk was mentioned several times in the MTBPS, and it noted that fiscal policy will continue to play a role in shifting economic incentives towards cleaner forms of energy. In this regard, the Finance Minister noted that South Africa is finalising negotiations on the pledges by the International Partners Group for the country’s Just Energy Transition. The MTBPS did not contain anything new about this topic and we suspect the government is keeping major announcements for COP27. 

*Ed’s note: Article supplied beginning of November 2022

New guidelines aim to capture more notifiable mergers

By Elisha Bhugwandeen, Senior Knowledge Lawyer & Daryl Dingley, Partner at Webber Wentzel

On 23 September 2022, the Competition Commission published final Guidelines on Small Merger Notification (Small Merger Guidelines) which significantly expand the scope of potentially notifiable mergers. Small mergers are transactions that do not meet the prescribed intermediate or large merger thresholds. The Small Merger Guidelines propose that, if certain criteria are met, the Commission must be informed of all small mergers and acquisitions.

The previous draft of these guidelines was specifically aimed at capturing small mergers where the merger parties operate in digital or technology markets due to concerns that acquisitions in this space often escape regulatory scrutiny. However, the final version of the Small Merger Guidelines places an obligation on merger parties to inform the Commission of all small mergers that meet the requisite criteria, not just those in the digital space.

When will firms need to inform the Commission about small mergers?

• The Small Merger Guidelines still state that, if at the time of entering into the transaction, any of the firms (or firms within their groups) are subject to a prohibited practice investigation by the Commission or are respondents to pending proceedings following a referral by the Commission

to the Competition Tribunal, then the Commission must be informed in writing before implementation of the small merger.

• However, the Commission will require that it also be informed of all small mergers and share acquisitions where the acquiring firm’s turnover or asset value alone exceeds the large merger combined asset/turnover threshold (currently R6.6 billion) and at least one of the following criteria must be met for the target firm:

• the consideration for the acquisition or investment exceeds the combined asset/ turnover threshold for intermediate mergers (currently R190 million) [Note: this amount is an error, which the Commission has undertaken to correct]

• the consideration for the acquisition of a part of the target firm is less than R190 million threshold but effectively values the target firm at R190 million or more.

What is the procedure for informing the Commission?

Parties to small mergers which meet the above criteria are advised to inform the Commission in writing, of their intention to enter into the transaction. The parties should provide sufficient detail on the acquiring and target firms, the proposed transaction, and the relevant markets in which the firms compete.

There are many aspects of the Small Merger Guidelines that raise concerns. There is uncertainty as to how the thresholds should be interpreted, and it remains to be seen if there will be any consequences for firms involved in mergers that meet the relevant criteria and fail to inform the Commission. This additional administrative obligation also adds a layer of regulatory red tape that may be seen to hinder, instead of facilitate, investment into the country. 

Interoperable real-time payments

draws closer

PayShap, South Africa’s first low value, interbank, real-time digital payments service will be offered by participating banks in 2023.

“Making a low value (under R3 000) payment to an account at any other bank should be quick, easy and affordable,” says Mpho Sadiki, Head of Real-time Payments at BankservAfrica.

The underbanked, cash dominant market will benefit the most “While most banked South Africans will enjoy the convenience of this service, we believe it is the underbanked, cash dominant market that will benefit the most,” he says.

PayShap reduces the need for cash on hand which makes it a safer option for South Africans to use in their daily transactions including taxi fares, barbers/ hair salons, school fees, restaurants or to reimburse friends or family.

Consumers will be able to access PayShap through their banks’ selected banking channels such as internet banking, banking apps or their bank’s USSD. PayShap will initially be offered by four banks, including Absa, FNB, Nedbank and Standard Bank. The roll-out will then extend to more banks who will start offering the service in the months to follow.

Banking institutions support PayShap

“As a full-service financial institution that serves customers from all walks of life, Absa is delighted to be among the first cohort of banks to bring PayShap to the South African market. As the payments ecosystem evolves providing safe, quick, and convenient solutions is vital to enable greater financial inclusion. We look forward to the official launch of PayShap in 2023 and continue to work hand-in-hand with the industry to ensure a successful roll-out,” says Charl Smedley, Absa’s Head of Payments.

Ravi Shunmugam, CEO of FNB EFT Product House, says, “FNB is proud to be a founding member of this modernised, inclusive payment infrastructure and we look forward to bringing innovative instant-payment solutions to our customers.”

“Ensuring accessible payments solutions for all South Africans has been a key focus at Nedbank, evidenced by the number of innovative services introduced to date, for example Tap on Phone and Money Message, which are designed to empower merchants to accept digital payments. Our participation in this industry initiative is a declaration of our commitment to ensuring that all types of payments offered by Nedbank are simple enough to be understood and adopted by all, accessible, and most importantly, affordable allowing value exchange across all parts of our economy,” says Chipo Mushwana, Nedbank Executive for Emerging Innovation.

“Our purpose is to drive Africa’s growth. Our participation in the PayShap programme to build a payment service which truly serves the banked and underbanked customer. It enables us to continue to accelerate financial inclusion through safe, affordable, accessible and convenient digital solutions,’’ says Rufaida Banoobhai, Head of Payment SA, at Standard Bank.

Released to the market in two stages

The PayShap service will be released to the market in two stages. The first will see the launch of the instant clearing feature which includes the ability to either pay-by-account (using account details) or pay-by-proxy (using a unique identifier such as a cellphone number). The second stage will introduce an additional request-to-pay function which makes it possible for a person to request payment and receive money securely and immediately in their bank account.

“We are excited to see this collaborative partnership between BankservAfrica and the banking community to bringing PayShap to the market and making it part of everyday life. PayShap will kick-start the economy of the future and create the opportunity for digital enablement and inclusion of all South Africans,” concludes Sadiki. 

Transform your business. Change youth lives

The Youth Employment Service (YES) is one of the biggest private sector youth employment programmes in the country that is affecting broad-based change across sectors, provinces and communities. We’ve injected over R5 billion in youth salaries into the economy in just under four years, with no government funding.

As a private sector led initiative, we help tackle the country’s youth unemployment crisis by empowering businesses to create 12-month quality work experiences for unemployed youth. In return for creating these jobs, businesses receive up to two levels on their B-BBEE scorecard.

For your first year with YES, your business can receive its B-BBEE level up almost immediately if youth are contracted before your financial year-end.

Businesses can place youth internally in their own structures, or in YES vetted host partners through the turnkey solution. The turnkey solution works with host partners across South Africa to place youth. These partners are working in high-impact sectors such as digital, agriculture, small business development and the green economy. Youth are placed in their communities, which means they can play an important part in building their own economies.

Register for YES today. Gain B-BBEE levels immediately. Change lives forever.

Here are the top reasons over 2 200 businesses have signed on to co-create a future that works:

1. The YES model creates measurable and meaningful broad-based impact.

2. It’s an effective way to gain B-BBEE levels and transform your business.

3. YES programmes are easily integrated with a business’ environmental, social and governance (ESG) strategies.

4. YES partners with businesses to create programmes that directly uplift communities.

5. YES programmes create a critical talent pipeline for your business.

6. YES has placed strong focus on ensuring excellent governance and processes leading to four years’ worth of clean audits.

Join the movement!

Number 1 risk to your business: 2 in 3 youth are unemployed.

Over 2,200 businesses are creating 12-month work experiences for youth. Join the movement and gain up to two B-BBEE levels almost immediately and/or integrate into your ESG strategy. Join YES now.

of African tech startups Boosting performance

New research at Stellenbosch Business School has identified and developed a model of the most critical capabilities that enable startups to identify and exploit opportunities, drive the delivery of innovative products and services to consumers, and build sustainable businesses that attract investment.

The research and model are set to disrupt the future of entrepreneurship education and challenge the prevailing mindset of entrepreneurship in Africa. Understanding the key drivers that turn an entrepreneurial mindset and innovative ideas into high-performing businesses could hold the key to reducing the 95% first-year failure rate of African tech startups and unlocking their potential to boost economic growth and job creation.

Entrepreneurship is seen as the catalyst for addressing Africa’s socio-economic challenges, but while the continent has no shortage of innovators and entrepreneurs willing to take risks, the performance of many startups is limited by their lack of the know-how to achieve growth and scale.

Less than two percent of internationally recognised high-tech startups originate from the African continent. Of the 600 “unicorn” tech startups (companies valued at over $1 billion) in the world, the African continent, with over a billion people, has produced just seven.

Critical capabilities that enable startups to succeed

New research at Stellenbosch Business School has identified and developed a model of the most critical capabilities that enable startups to identify and exploit opportunities, drive delivery of innovative products and services to consumers, and build sustainable businesses that attract investment.

Stellenbosch Business School PhD Business Management and Administration graduate, Dr Ekene Onwu, surveyed more than 250 people engaged in tech startups in four African countries – Ghana, Kenya, Nigeria and South Africa – for his study on the drivers of entrepreneurial orientation and innovation capabilities in African tech startups.

The four countries together have attracted the most startup investment on the continent to date.

“The research indicates that tech startups that cultivate a comprehensive, developmental approach that looks at their top management capabilities, their technological competencies as well as their ability to foster rapid and locally relevant learning, have a better chance of succeeding despite the obvious macro-economic challenges in Africa's dynamic and complex business terrain,” Onwu says.

He hopes that by applying his “sense-seizetransform” African model of interlinked, dynamic

capabilities, startups and their founders will have a better set of performance indicators to assess their “culture, mindset, behaviours and ability to succeed, where so many seem to have failed before.”

Seizing opportunities and transforming them into sustainable business success

His research identified that the capabilities of top management, the business’s technological competency and the ability of the organisation to learn and adapt to a changing environment are the key factors that enable the business to identify (sense) and seize opportunities and transform them into sustainable business success through an entrepreneurial mindset and ability to innovate.

“Having the ‘technological DNA’ alone is not enough to guarantee success in highly competitive and rapidly evolving digital environments. Many businesses fail because they lack the knowledge, networks and capabilities to effectively drive their performance.”

“To achieve favourable business outcomes in high-tech environments, startups must be able to constantly sense opportunities, and strengthen their capabilities to seize and transform opportunities and tackle complex business problems, threats, and opportunities as and when they appear.”

“Achieving these capabilities allows the tech startup to drive productivity and bring changes in the market that its competitors are unable to,” he said.

Important in helping nations combat socioeconomic challenges

The knowledge gap in many developing countries, on what business capabilities to foster and focus on, has led to low levels of sustainable innovation and entrepreneurial activity, threatening much-needed employment creation and economic productivity.

“Ensuring the success of tech startups on the African continent has become increasingly important in helping nations combat socio-economic

challenges such as high rates of unemployment, food and healthcare insecurity, environmental sustainability, financial exclusion, and infrastructural deficiencies.

“Tech startups need to succeed as they are drivers of economic development and productivity improvements and are the catalysts for novel industry, product and service creation as well as attracting foreign direct investment to developmental sectors,” Onwu says.

However, the performance of tech startups across multiple sectors and industries on the African continent had been “dismal”, he said, with very few attracting venture capital investment or being targeted for acquisitions by larger, more established businesses, in comparison to startups in the West. These are considered key indicators of startup success.

Internal dynamic capabilities that enable startups to survive, adapt to change and grow

While venture capital investment of $560 million in some 80 African startups in 2017, showing year-on-year growth of over 50%, could be seen as positive for the continent, he said this was negligible compared to the USA alone. In the same period, over 8 700 US tech startups attracted $85 billion dollars in investment, representing growth of over 400%. In Onwu’s research sample, 37% of the businesses were self-funded, while only 7% had attracted venture capital investment.

Infrastructure challenges on the African continent play a significant role in hampering business startups, with 61% of the startups that Onwu surveyed struggling with access to electricity and 71% lacking reliable internet access. However, since these challenges are largely out of the business’s control, Onwu focused on the internal dynamic capabilities that enable startups to survive, adapt to change and grow despite Africa’s complex and dynamic business landscape.

His research found that improving top management capabilities (to think, to network, to lead and to effectively deploy technical resources) and the business’s overall technological competence had the greatest positive effect on both its entrepreneurial orientation and innovation capabilities and strengthened their combined impact on the firm’s ability to perform.

“The findings also indicated that there was a positive effect on the performance of tech startups who comprehensively focused on improving both their entrepreneurial orientation (being proactive, risk taking, autonomous etc.) and their innovation capabilities (product, process and marketing innovation) simultaneously,” Onwu said.

A comprehensive, integrated view The significance of his research is that the capabilities and drivers are usually studied and considered in isolation and inferences made from them are often over simplistic and impractical, but his model takes a comprehensive, integrated view that highlights their linkages and directly links a key set of capabilities to organisational performance.

“Startups often look at capabilities in isolation as drivers of success, but this limited focus does not give them the comprehensive overview needed to drive success in an increasingly digitised business climate,” says Onwu.

“Startups that develop the appropriate internal capabilities, and take a holistic, integrated view, can better understand where exactly investments are needed internally to foster their growth, scalability and ability to drive performance. It is about simultaneously looking at the capabilities of the top managers, the technological skills, knowledge and will of the whole startup, their ability to learn and unlearn processes in a way that's entrepreneurially deep and innovatively robust that will impact their ability to perform and survive doing business in Africa,” he adds. 

A data breach

can sink an SME

Cybersecurity experts GoldPhish warns of the damaging consequences of data breaches for SMEs, and that a more proactive approach to cyber protection is imperative to survive an inevitable breach.

When it comes to reporting on cybercrime, we tend to only come across the stories impacting major companies or industries. Apart from the obvious reputational damage, we don't really grasp the consequences of something like a data breach on a company and its customers. There are no headline articles about the troubles that emerge in the wake of a data breach, some of which literally grind small and medium enterprises (SMEs) into the ground.

The media focuses on corporate giants as the

only victims of cybercrime, lulls us into a false reality where data breaches seem to happen mostly to corporate behemoths but not the small or medium size business owners. Cybercriminals, who are often well-organised and well-resourced, launch constant attacks on data targets, probing for the weak spots. SMEs typically invest far less resources in cybersecurity than big corporations, which can make them a far more attractive mark to criminals, and their businesses far more vulnerable.

SMEs who are not cyber savvy or don’t have suitable measures in place are the easiest targets when it comes to exploitation by cybercriminals.

SMEs at greater risk of becoming a target for cybercrime

According to Dan Thornton, CEO of cybersecurity awareness training business, GoldPhish, the often false perception that “it won’t happen to us,” puts SMEs at greater risk of becoming a target for cybercrime.

"Perpetrators of these crimes are well-aware that while big companies are investing heavily in their cybersecurity, SMEs who also collect and store significant client and customer data, aren't taking preventative action in the same ways.

It's a myth that hackers and scammers are only interested in the big data collected by corporates or governments. SMEs who are not cyber savvy or don’t have suitable measures in place are the easiest targets when it comes to exploitation by cybercriminals," he explains.

There are many SMEs that collect customer data, which includes banking, financial and tax information, contact and residential details, consumer purchasing history and even sensitive medical records, the consequences of a data breach can be dire.

"We all read the headlines saying that yet again millions of customers' data has been breached. Shock, horror, and then that's it. But it's not like that. Data breaches have longterm consequences. Many of them actually sink companies, and many expose consumers to ongoing risks,” Thornton says.

What happens after a data breach?

After a data breach, companies can potentially face regulatory liability and third party liability, but

this is not the full extent of the possible damages. Cybercriminals may hold the data hostage to extort a ransom from the company, and they may also mine sufficient data to target consumers - a data breach is not an end-result but a pathway to ongoing cybercrimes.

According to IBM data, by mid-2022 the average cost of a data breach was $4.3 million, a new high record.

"Reputational damage for companies that we trust with our data can be devastating, and many businesses never recover from a data breach. Companies need to take their data protection seriously and establish full visibility of what data they’re holding, where they are storing it, and also justify why they’re holding it. In addition, they need to implement data protection strategies and ensure their staff are well-trained when it comes to cybersecurity. Ensuring that your employees are trained to be cyber savvy has become critical to the mission of every business, small, medium and large,” Thornton notes.

Cybersecurity should be front of mind for all SMEs. Meticulous processes governing data collection, storage and sharing in accordance with regulations should be controlled and the following approach is recommended:

• Ongoing, company-wide cybersecurity training,

• Implementation and maintenance of proven cybersecurity strategies,

• Investment in cyber insurance coverage, Cybersecurity for SMEs needs to be embedded along with all other efforts to create a secure working culture. Employees, business leaders and customers all value this. No business can afford a 'it won't happen to us' mindset.

Cybercrime is set to become the greatest security threat to all kinds of business, and it's important to invest the same care in your digital assets and consumer data. Understanding the threats and knowing how to mitigate the risks is essential. 

AIMS International: top tier executive search

Successful businesses depend on highly effective professionals and executive management with impeccable business acumen, technical know-how and a leadership capacity that is out of the ordinary. Such people are not easy to find in a diverse and fragmented world. When considering the diversity of the African business markets, it is even more important to understand the nuances of each market on our continent.

Our executive search framework at AIMS International is part science, part art. We painstakingly analyse data, biometric evaluations, skills assessments while combining cutting edge assessment tools with our experienced consultants’ behavioural interview evaluations to give our clients guaranteed success. We are proactive in our research practices, hand-picking only the best talent for our clients to choose from. With partner offices in over 50 countries around the world, our clients have the added advantage of an additional 260 search and talent management experts at their fingertips.

To give our clients value added services, we have an in-house organisational psychologist who supports our clients to make the best decisions to acquire fit for purpose candidates. With more than two decades of experience on the continent, our recruitment expertise spans across professional, senior and executive management roles in the following industries: Industrial, FMCG, Financial and Professional services, Energy and Natural resources, Life Sciences, Media and Technology and Automotive.

Our lineage of expertise from around the world helps us to infuse global best practise with local knowledge so that we can find and grow world class teams that increase organisational performance.

We have a dedicated qualified team and sustainability programme, allowing us to keep abreast with new trends and the changing needs of our clients. In a time where women empowerment is a top agenda item for governments and businesses, we have started tracking gender statistics in our international repertoire, ensuring that we assist our clients to achieve gender parity and inclusive growth. At AIMS South Africa, we believe that happy staff are synonymous with high performers and are passionate about the organisational happiness of our client companies.

Be part of our great expansion. Visit us at www.aimsinternational.com/za for more.

Arthur Nkuna Partner arthur@aimsinternational.co.za

Leonie Pentz Managing Partner leonie@aimsinternational.co.za

Ashleigh Ball Consultant ashleigh@aimsinternational.co.za

leonie@aimsinternational.com arthur.nkuna@aimsinternational.com aimsinternational.com/za

leonie@aimsinternational.com arthur.nkuna@aimsinternational.com aimsinternational.com/za

leonie@aimsinternational.com arthur.nkuna@aimsinternational.com aimsinternational.com/za

MOVING YOUR ORGANISATION

MOVING YOUR ORGANISATION

MOVING YOUR ORGANISATION

Environment. Society. Governance.

Environment. Society. Governance.

Environment. Society. Governance.

Subsea cable connectivity: the key to accelerating digital transformation

By Matone Ditlhake, CEO of Corridor Africa

Subsea cable connectivity is the key to accelerating digital transformation in Africa. Google launched its $1 billion Equiano cable, a connection between Western Europe and South Africa. This announcement also coincides with Meta-backed 2Africa, the world's longest subsea cable which is expected to come online in 2024.

The Equiano 144Tbps, 12 fibre pair cable will ensure faster internet speeds and reduced internet prices when it is switched on before the end of the year. It will be Africa's highest capacity cable and stretches more than 15 000km from Portugal to South Africa.

Subsea cable connectivity will help governments throughout Africa achieve their digital transformation goals and objectives. In South Africa, it will contribute considerably to Government's NDP2030, and SA Connect strategies.

Infrastructure development and digital and socio-economic transformation were the key topics at the 2022 GovTech conference, the annual meeting platform for representatives from government and industry to connect in serving citizens to better use information and communications technologies.

Government committed to delivering broadband objectives Khumbudzo Ntshavheni, the Minister of Communications and Digital Technologies, promised that Government was committed to delivering on broadband objectives as key enablers for the delivery of an economic step change for South Africa.

Government is implementing a broadband connectivity drive through SA Connect and its goal is to ensure that all South Africans have access to the internet. According to Google, the Equiano subsea cable will lead to the creation of 1.6 million jobs, and it expects data prices to drop by at least 20 percent.

Through SA Connect, Government plans to connect over 400 sites in the Eastern Cape and the Northern Cape and then provide internet access for everyone across the country in phase two. This programme aims to connect over 33 000 community Wi-Fi hotspots over three years.

Government partnership with ISPs Ntshavheni recently said a revised model for SA Connect would include a partnership with ISPs, access network service providers, and mobile virtual network operators in the SME space. She referred to this collaboration as part of Government's commitment to the transformation of the telecoms industry.

Digital transformation involves the ongoing application of the latest technology to improve a government’s performance and help meet the expectations of its citizens. There is no doubt it is important; digital transformation offers many solutions to e-Government services as it addresses most of the challenges in e-Government.

It is clear that the Government has put policies in place to support digital transformation and with advances in infrastructure and digital technologies, it might successfully address its challenges to realise its global digital strategy successfully.

South African Government is certainly lagging behind with digital transformation in realising its goal for e-Government. It needs to work in close cooperation with stakeholders to achieve e-Government through digital transformation. Citizens will be seeing more and more of this digital transformation over the next few years.

It is clear that the Government has put policies in place to support digital transformation and with advances in infrastructure and digital technologies, it might successfully address its challenges to realise its global digital strategy successfully.

Sharing is caring, and the road to a

great digital future

Being an entrepreneur and having a good business idea is not enough, especially in the competitive and every-changing digital space. Success is directly linked to education; the more you learn about business, handling income and expenditure, legal requirements and running a business, the better the chance that what you create will be sustainable.

Notes Technologies, the recent MTN Enactus Digital Innovation Challenge winner, is a case in point. Notes Technologies, an app created by students for students, has reached the pinnacle of achievement through the Enactus Digital Innovation Challenge programme and as a graduate of the MTN-funded 12-month Business Support Programme for SMMEs within the ICT Sector.

At the 2022 MTN Business App of the Year event, the business, which is a part of the Enactus programme at the Vaal University of Technology, also won first place in the Campus Cup Challenge category, walking away with a R50 000 cash prize that will be used to take the app to the next level.

Notes Technologies’ success is based on the belief that by sharing notes, students can simplify their tertiary studies, help others and cut the costs of studying. Their app, built for mobile devices, enables students with good notes across various subjects to load their study notes for others to use. When others use the notes, they receive payment. For users, a fee of R15 a month gives unlimited access to material that can be filed in the app for easy access.

The MTN SA Foundation is a long-time supporter of entrepreneurs and South Africa’s SMME sector.

Over the past eight years, the Foundation has taken a holistic approach to driving small business development in South Africa. Through enabling the success of many graduates of its various skills development and upliftment programmes, the Foundation has proved what can be achieved by strong partnerships and focused, complementary initiatives.

Developing future entrepreneurial leaders within the tech space

Notes Technologies

graduated from the MTN Foundation’s annual Business Support Programme for SMMEs in December 2021. They joined another 99 selected ICT SMME entrepreneurs in the first national rollout of the programme. For 12 months, they participated in workshops, group training sessions, one-on-one mentorships and coaching, which focused on access to markets, funds, skills and access to technology.

An app created by students for students

Offered by the Foundation in partnership with Datacomb Development Hub, Hodisang Dipeu Holdings and the University of the Free State, the entrepreneurs were provided with training courses and learned about developing and drafting business plans – essential skills when looking for finance or backers.

“Enactus Digital Innovation Challenge, which MTN has funded for seven years, is vital to developing future entrepreneurial leaders within the tech space. The challenge requires university students to identify socioeconomic challenges across the agriculture, education, and health sectors, and create solutions that are technologically driven,” says Kusile Mtunzi-Hairwadzi, General Manager of the MTN SA Foundation.

“The development of digital services that address the United Nation’s Sustainable Development Goals, which is aimed at eradicating poverty and bringing global prosperity by 2030, is our key focus.

“Student entrepreneurs first identify the top socioeconomic concerns within their respective province and then leverage the design thinking methodology to build and launch meaningful digital solutions to these challenges across the selected sectors. The best ideas are then funded so that a protype of the app can be developed,” adds Mtunzi-Hairwadzi.

Notes Technologies came out top in this process in 2019 when they, along with five other selected student-led project teams, were required to pitch their ideas and have them thoroughly scrutinised by a panel of experts.

“From six finalists in 2019 where Notes Technologies was the trailblazers from the shortlist, the Challenge has since grown to award 12 digital innovators each year, who all take home between R60 000 and R70 000 towards the development of their winning app concepts, business registration (CIPC) and marketing-related costs for their businesses.

A holistic approach to encouraging growth in the SMME sector

“Due to the sheer volume and success of businesses that have been bred in the MTN Digital Innovation Programme, it has quickly grown into the most popular special competition within the annual Enactus South Africa roll-out. Over the years we have seen a steady increase in the quality of solutions that that are being produced from the universities and look forward to celebrating their growth trajectory as we are seeing with Notes Technology today”, says Enactus South Africa NPC ‘s CEO and Country Director, Letitia de Wet.

“Notes Technologies took these learning and growth opportunities, developed their app and excelled further to win the Campus Challenge at the MTN Business App of the Year Award-distinguishing themselves at what is now Africa’s premier digital event.”

The MTN SA Foundation believes that a holistic approach to encouraging growth in the SMME sector is essential

if small companies and the entrepreneurs that drive them are to take their rightful place as innovators and future employers in the national economy.

“Key to achieving these two objectives is encouraging participation in the digitally based Fourth Industrial Revolution and creating a generation of young, digitally orientated entrepreneurs with the skills to ensure South Africa is internationally competitive. The MTN SA Foundation is proud that we are part of this nationbuilding process by enabling developers like Notes Technologies to develop their skills,” concludes MtunziHairwadzi.

For more information and other MTN SA Foundation programmes, visit www.mtn.co.za

Shattering

the glass ceiling

Gender equality, diversity, and inclusion in the built environment professions.

Despite the strong business case for gender diversity in the built environment, the gender representation, advancement, and retention of women in the sector remains an elusive dream with the latest figures released by StatsSA showing that women make up more than 50% of the South African population; however, only 13% of registered persons within the built environment professions were women in 2021.

“Like any other professions in the country, the built environment sector is facing serious challenges: Slow pace of transformation, ageing personnel, shortage of critical skills and high unemployment rates, especially amongst our youth,” says Msizi Myeza, CEO at the Council for the Built Environment.

“It is therefore important for the sector to take strides and develops strategies on how best to address crucial issues identified in the skills pipeline strategy for the built environment, especially gender representation, participation, and retention.”

Gender gap in the built environment commences in primary school

Various studies corroborate that while it is important to raise alarms about the slow pace of transformation, the gender gap in the built environment commences in primary school and that is where we must intervene.

Moreover, a report by the African Academy of Science revealed that by primary school the belief of ‘girl jobs” and ‘boy jobs’ are already entrenched, meaning that the gendered school curriculum also influences girls’ and boys’ future career choices.

A growing body of evidence indicates that female attrition in built environment professions occurs increasingly at the point between tertiary education completion and career transition.

Globally, statistics show that women exit

architecture, engineering and construction professions at a higher rate compared to their male counterparts and females leave within the first five years post-graduation.

In 2014, the Engineering Council of South Africa (ECSA) reported that 70% of the women who graduated with engineering degrees left the profession after starting their careers because they felt isolated in their jobs. Numerous studies confirm that women who leave the professions had limited access to career advancement and were dissatisfied over renumeration than those who persisted.

Other major obstacles that women encounter in the workforce include sexual harassment, inflexible work practices, lack of sanitary facilities on construction sites and the masculine culture of the industry.

“The CBE believes achieving gender equality in the built environment requires a multi-pronged approach, combining hard and soft laws, strategies, including setting of targets, which are enforced and monitored. Therefore, the alignment between South Africa’s economic, gender, and procurement policies becomes instrumental for the attainment of transformation in the built environment. CBE also believes that this can be achieved through the formulation of gender sensitive policy frameworks and interventions to improve the working conditions of women”, says Myeza.

The work of the Women Empowerment and Gender Equality Transformation Collaborative Committee is anchored around creating a diverse and inclusive built environment, by building the pipeline of female talent throughout the skills pipeline, identifying support for female entrepreneurship, advocating and promotion of gender inclusive policy and procurement, facilitating the representation and participation of women in key decision-making structures, coordination of coaching and mentorship initiatives and through the creation of platforms for strategic partnerships and networking.

Interventions that bolder women’s feelings of belonging in the built environment are critical at post-secondary and early career levels, long term career development, career re-entry programmes which encourage women to resume their careers after taking a break to start a family, mentoring professional coaching and professional development and flexible work practices are also critical for the development and retention of women.

In conclusion, Myeza says, “The Council for the Built Environment encourages built environment professionals and councils to champion transformation by positioning themselves as an agent for the change we desire to see in the profession.”  www.cbe.org.za

Achieving gender equality in the built environment requires a multi-pronged approach

Increase in insurance claims

by incapacitated employees

Historical underinvestment in mental health services in South Africa has been compounded by an increase in insurance incapacity claims for mental health issues, compounded by long Covid health conditions.

Alexforbes Health Management Solutions (HMS), a health risk manager within the employee wellbeing space, has seen up to a 40% increase in such incapacity cases over the past year.

According to Gareth Friedlander, Discovery Life Deputy Chief Executive, the insurer was concerned about the growing prevalence of claims related to mental health conditions. Liberty reported a spike in mental health claims from its clients during 2021, particularly among working people between 35 and 54 years. This is

largely attributed to the stresses brought on by the pandemic.

“Some individuals suffering from long Covid symptoms do not realise it, which increases anxiety and mental health conditions,” says Alexforbes HMS head, Myrna Sachs.

Long Covid is defined as Covid-19-related symptoms that are present 28 days or more after the onset of acute infection and can last months. Symptoms can be physical and psychological.

Impact of pandemic highlights need for more awareness

Long Covid is not the only driving force increasing mental health issues. The actual impact of the pandemic (financial and psychological) for those affected and infected has also highlighted the need for more awareness and support, says Sachs.

Mental health conditions are a cause of incapacity, disability and exclusion. They affect people’s ability to contribute to their workplace and families. The World Bank considers mental illness to be the greatest thief of productive economic life. Yearly global costs from mental, neurological and substance use disorders are estimated at between $2.5 and $8.5 trillion dollars a year, projected to double by 2030.

“The impact of poor mental health among employees therefore has highly apparent and direct repercussions for employers,” Sachs says.

An article on mental health in Africa published in The Lancet Global Health journal notes that “there are 1.4 mental health workers per 100 000 people, compared with a global average of nine per 100 000”.

“In South Africa, access to psychologists and counsellors is limited to the wealthy, and even then, you can wait weeks for an appointment. Government hospitals and clinics do not have the capacity or professional staff to deal with the increase in mental health,” says Sachs.

“This is not a new problem. Mental health has always been ‘neglected’ and this is now exacerbated by the current situation. Therefore, an opportunity exists for employers to fill this gap by offering access to professional counsellors.”

Mental health under-reported because of stigma attached Sachs notes that mental health conditions are generally under-reported due to the attached stigma.

“Employees don’t want to divulge that they have a problem, or they are not aware that they have a problem. They just relate their symptoms to something physical, so they don’t get treated timeously. Employees are still scared they will lose their job if they disclose; they feel they will be ostracised and they feel vulnerable.”

Sachs says employers play an important role in breaking the stigma around mental health by conducting education sessions and having employee wellness programmes in place. Employees need supportive, open communication and an empathic approach from management.

“The onus is on employers to create an environment which is more conducive to dealing with mental health illness. They should have policies in place which look after the wellbeing of employees by monitoring absenteeism, as this is one of the early warning signs of poor mental health.”

Poor mental health of an employee affects business, resulting in poor productivity and low morale, as well as affecting other employees.

“There are bottom-line losses due to productivity, as well as direct and indirect costs of absenteeism,” says Sachs.

Sachs says employees needed to be empowered to know how to access mental health support and champion this, “as mental health challenges are also a major contributor to physical health and general wellness”. 

Here’s how to plan for healthcare costs in retirement

Most South Africans leave their retirement planning too late – and when they do finally get around to it, they often fail to include the rising cost of healthcare in their considerations, which could seriously impact the quality of their lifestyles.

Feldman – Executive Head: Healthcare Consulting

That’s the grim warning from Gary Feldman, Executive Head of Healthcare Consulting for employee benefits firm NMG Benefits, who says many consumers do not realise that assistive devices and aids are not always covered by medical aids. StatsSA estimates that nearly one out of every four South Africans over the age of 60 use chronic medication; one in five use assistive devices like glasses; one in 10 wear hearing aids; and 5% use wheelchairs.

“If you can’t afford your necessary assistive devices or chronic medication, you may face debilitating pain and even depression due to your physical and financial circumstances,” says Feldman.

On average, healthcare costs tend to sit 3%4% above inflation every year, with few employers offering medical aid subsidies for their retirees. As a result, retirees are under increasing pressure to afford their medical aid premiums. According to Feldman your health care costs in retirement depend on three factors.

1. Your health status

2. Your medical scheme plan option

For increasing medical scheme costs, review your plan options regularly. Some medical schemes will allow a downgrade during the year, however many won't allow you to upgrade until the end of the year.

3. When you start saving

Your medical costs will increase as you age therefore it's a good idea to plan early and start saving for these costs while you are younger. The sooner you start saving, the less you will need to save each month to reach your savings goal because you will be saving for a longer period.

To address the problem of consumers who are unprepared for rising healthcare costs, NMG is preparing to launch a retirement annuity, NMG SmartAid, that is dedicated to saving for medical costs in retirement and focuses on the expected income a consumer’s savings can buy at retirement.

The company will provide a calculator to help users determine how much they should be saving for their healthcare needs in retirement, and an annual statement reflective of the member’s on- or off-track status. Members who are not on track are given information on how to get closer to their targets.

Your current health and your family's medical history can tell you how much you can expect to spend on medical cost as you age. Other important factors include: Are you a smoker? Do you visit the doctor often? Do you have chronic health conditions? www.nmg.co.za

Gary

Here’s how to increase your financial literacy

If your answer to any of the above is ‘no’, you could be among the numerous South Africans in need of financial literacy education. The effects of poor financial literacy can be devastating on your financial future, right through to retirement, where it is estimated that only 6 out of every 100 individuals will be able to retire comfortably.

According to Kantar research, most South Africans want to save, but they simply don’t understand the various options available to them, from traditional bank savings accounts to new platforms like cryptocurrency. As a result, the average consumer now spends more than 75% of their take-home pay on debt; and eight out of every 10 of us can’t make ends meet every month.

“Financial literacy affects every aspect of our lives, from education to where we live and how we access medical care. The less debt we have, the less stressed and heathier we are. Even just taking a few minutes every day to educate ourselves better about financial matters is an investment in our futures,” said says Craigh Chidrawi, Head of Retirement at employee benefits advisory firm NMG Benefits.

A survey by DebtSafe in June saw 80% of respondents saying they struggle to save, because they don’t have enough money to cover their living expenses, and many are mired in debt. A third of respondents said a lack of finance knowledge is the main reason they struggle to budget. Around

80% of people run out of money within five days of being paid – and because they don’t know any better, they turn to payday lenders, personal loans and unscrupulous lenders to get them through the month.

App-based financial learning experiences

One solution to the problem of low financial literacy lies in app-based financial learning experiences, says Chidrawi. These apps provide users the knowledge to understand financial matters through easy to grasp, story-driven educational content that is delivered to their mobile phones.

NMG’s own offering to employers is SmartAlec – powered by global financial education fintech FinEazy – teaches users a range of financial principles, such as banking, types of bank accounts, payments and savings through to sophisticated investment portfolios. It also provides guidance on short and long term insurance.

“If you don’t have access to an app through your employer, there are numerous free online resources to help you start making better financial decisions. Good financial literacy is the foundation for a better life for you and your family,” says Chidrawi.

Do you know how to get the most value out of your banking? Are you savvy in the way that you save? Do you know how to reduce debt and increase your credit score? Do you understand basic investment principles? Do you know how to use your money to get the greatest tax benefits possible?

Craigh Chidrawi – Executive Head: Retirement

Are electronic product producers compliant?

The legal criteria for Extended Producer Responsibility (EPR) came into effect in May 2021.

EPR aims to ensure that producers are accountable for the whole life cycle of the products they market and sell, from conception to postconsumer waste disposal.

In South Africa, these producers are defined under the EPR regulations to include the full value chain: From manufacturers, converters, and refurbishers to importers and brand-owners.

Any persons or category of persons involved in the commercial manufacture, conversion, refurbishment, or import of any new or used EPR items fall under this category.

Manufacturers and importers of packaged goods also fall under the definition of "producers" of packaging materials and will be impacted.

The onus now also falls on producers

According to Patricia Schröder, spokesperson for the producer responsibility organisation (PRO) Circular Energy NPC, this decision is a game changer.

“Before the passing of the EPR regulations, the public, including local governments and business,’ bore the full financial burden and responsibility of waste collection and disposal,” she explains.

“These regulations return the onus of responsibility to the producers of electric and electronic equipment, lighting and light equipment and paper, packaging, and single-use goods. They must be accountable for a product's whole lifespan.”

Schröder elaborates that it is intended that by making manufacturers financially and/or operationally accountable for their end-of-life products, more waste will be kept out of landfills; and more recycling and other circular economy initiatives will gain traction.

“The producer of electrical or electronic equipment, lighting and lighting equipment and paper and packaging must be either the brand owner of the items using the packaging, the retailer in the case of house brands, or the importer of the goods contained in the packaging, according to international best practice. As it engages all stakeholders at every level of the packaging value chain, this innovative strategy might be a workable means to move towards sustainable waste management and a circular economy.”

With the development of the 2023 EPR plans underway, Schröder explains that the focus now falls on the submissions and ability of the PROs to meet the legislative requirements.

“It is now mandatory for producers to register with the Department of Forestry, Fisheries and Environment (DFFE;) on their website and ensure that all recognised products are covered by an appropriate EPR Scheme.”

PRO’s can assist in reducing the administrative workload

Schröder explains that producers must also comply to the following options: they must join an existing PRO, or create and submit an independent EPR Scheme (the 5 Nov 2021 deadline for this has already passed) to DFFE for their electrical and electronic products, lighting and lighting equipment and packaging.

“Joining a PRO is very beneficial, as it can help producers be compliant through its take-back scheme,” Schröder says. “In order to ensure that their producer members are fulfilling their legal obligations under the EPR Regulations, PRO's can offer them the advice and services necessary.”

In addition, she emphasises the interests of the various sectors should be safeguarded to enable the entire take-back scheme is both effective and affordable for producers. This entails meeting all legal requirements in accordance with best practice principles.

“The PRO will be in charge of leading sectorbased waste minimisation programs, managing financial arrangements for funds to support waste reduction, re-use, recycling, and recovery, and developing innovative solutions to lessen potential effects of products on human health and the environment,” she concludes.

Schröder sums up the PRO’s primary goals as follows:

• Using a compliant effective and efficient system while adhering to stringent governance principles.

• Promoting and putting the concepts of the circular economy into practice.

• Contributing to the Sustainable Development Goals in order to make a real difference in the world.

• Caring for the environment with a multifaceted, best practice strategy. 

Atlantis SEZ driving

sustainable development and job creation

The ASEZCo, with its greentech theme, is a unique SEZ that speaks to the needs of investors in greentech. It is a key element in the Western Cape government’s Economic Recovery Plan and the scheduling of the company as a provincial business enterprise bodes very well for its role as a game changer in the renewable energy and green technology sectors of the Western Cape’s economy. The company seeks to attract greentech investors that embody the elements and ethos of green technology manufacturing and resource-efficient cleaner production.

Partnerships create rapid facilitation and access to opportunities

With the ASEZCo forming part of a mature and effective investment ecosystem in the Western Cape, your investment is sure to land in a credible administration in an efficient and cost-effective manner. Partnerships with InvestSA, Wesgro, GreenCape and the City of Cape Town’s Enterprise and Investment Unit create an environment of rapid facilitation and access to opportunities, which is considered to be best practise globally.

The support received from this ecosystem can be leveraged to make your business more globally competitive by accessing finance, trade opportunities

and access to locations which provide world class infrastructure and services.

Opportunities to establish profitable trade relationships exist through Wesgro’s Trade facilitation unit as well as GreenCape’s membership to the International Cleantech Network (ICN), both of which provide immediate access to international markets, growing your sales pipeline significantly and mitigating against supplying to a single market.

The ideal location Atlantis also presents itself as the ideal location from which to compete in Africa’s green technology markets by offering green infrastructure, a strong support base from government, as well as fruitful business relationships for investors, as you work closely with the locals and help uplift the community. This mutually beneficial relationship is a good foundation for sustainable productivity and success.

The Atlantis SEZ is positioning itself as an ecoindustrial park following UNIDO’s framework and aims to actively explore ways of achieving sustainable manufacturing through its Living Lab. The Living Lab is about working in collaboration with out tenants, investors and other partners to finds ways to improve resource efficiency and reduce carbon in manufacturing processes.

Atlantis in the Western Cape has been prioritised as a ‘greentech’ hub by all three tiers of government. The Atlantis Special Economic Zone Company (ASEZCo) is driving sustainable development and job creation in the area by harnessing the opportunities in a growing green economy.

The Living Lab has five focus areas, as follows:

1. Net Zero Carbon which means using as much renewable energy as possible. This can be done by roof-top solar panels, back-up storage and, ultimately biogas or hydrogen.

2. Net Zero Water which means using less water in the zone than falls onto the land each year. Atlantis already has an innovative water management system run by the City of Cape Town. The ASEZ aims to contribute to this through active on-site aquifer recharge, working with manufacturers to improve water efficiency and re-use of rainwater in the factories and for landscaping.

3. Net Zero Waste to Landfill which means working with industrialists to find creative ways of turning waste into resources for production processes.

4. Net Zero loss in ecological value/Working with nature which is removing alien plant species from the SEZ land, relocating existing threatened species and then once the factories are built, restoring as much of the ecology as possible in an industrial area.

5. Maximising social inclusion which means working closely with the community in everything we do, be it ensuring access to jobs during construction, training in new skills and helping support new businesses and SMMEs.

Green skills development and growing technical capabilities

Green skills development and growing technical capabilities within the Atlantis community are part of the ASEZCo’s strategic objectives, aligned to the legislative requirement of the Special Economic Zones Act to grow the regional economy and drive socio-economic impact.

The Integrated Ecosystem Unit (IES) includes Skills and Enterprise Development, together with Community Integration. The team applies principles of system thinking to identify and address deeply rooted socio-economic challenges in a complex community environment and to support expansion of community assets and adaptive systems.

The IES team’s work supports the Living Lab through its activities, most notably ensuring social inclusion through harnessing green technology for the Atlantis community, as well as its industrial zone. The team of six collectively implement initiatives to support the development agenda.

Their expertise includes business incubation, green economy and digital development, community engagement coupled with a wealth of business and local knowledge from three home-grown Atlantis talents. The aim is to enable the Atlantis community, and particularly its youth, to tap into growing job opportunities, particularly in the buoyant green economy.

The Atlantis Special Economic Zone will continue to grow the regional economy in a meaningful and impactful way, enabling the regeneration of Atlantis and a leader in green economy manufacturing in an eco-industrial park that puts sustainability, job creation and social inclusion at the top of its agenda.

T: +27 87 183 7000

E: info@atlantissez.co.za W: www.atlantissez.com

Sustainable short sea shipping –the way forward for SADC

Reducing the consistently high cost of logistics in Southern Africa is now a real possibility, thanks to a tried and tested intermodal solution using roll-on/rolloff (Ro-Ro) vessels.

Short-sea shipping is a strong and competitive mode of transportation for intra-regional supply chains. Referring to the movement of cargo by sea over relatively short distances, as opposed to intercontinental cross-ocean deep-sea shipping, it allows for trailers/vehicles to be rolled on and off shipping vessels, reducing the need for cranes and other equipment.

“Considering the challenges of the railway freight network and the high reliance on road transport in the region, moving cargo over short distances by sea offers vast potential in terms of cost savings and higher efficiency,” says William Greig, Chief Executive Officer of Argonaftis Shipping and Trading Ltd (MI).

Proven track record

The operation of Ro-Ro shipping services has been proven around the world. In northern and southern Europe, it is extensively used in a variety of industries.

“Ro-Ro shipping represents a maritime segment that could easily form part of a local intermodal transport system, as cargo does not need to be lifted in ports; it is ‘rolled’ to and from the sea. This will address some of the biggest challenges currently facing the logistics sector - including high costs, delays, congested ports and weak road and rail infrastructure,” explains Greig.

Cost-effective, safe and environmentally friendly

Short-sea shipping provides great environmental, social, and economic advantages and plays a key role in sustainable shipping.

“Ro-Ro ferries alleviate cost pressures through economies of scale and increased vehicle use. Operational costs are reduced by the fact that trucks have shorter journeys when

80-90% of the journey is via ferry,” explains Greig.

“This therefore substantially reduces usage and general wear and tear on vehicles, which promotes longevity and/or greater re-sale value at the end of the vehicle purchase contract.”

A safer choice

The increasing number of heavy trucks carrying freight over long distances has taken a devastating toll on Southern Africa’s deteriorating road network. While criminals attack trucks and their drivers at designated truck stops, they also intercept trucks along isolated sections of the vast and in parts desolate highway network.

“We can provide journeys that don’t require stops: therefore, drivers and loads are safer using our services. Logistics companies desire it, as their cargo will be at less risk from all the external forces of road haulage over vast distances,” continues Greig.

Another benefit of this mode of shipping is that it offers a more environmentally friendly alternative. Short-sea shipping involves much fewer carbon emissions per ton. The widespread adoption of short-sea shipping will greatly help to lower the carbon dioxide CO2 footprint of the region.

The solution for Southern Africa, says Greig, is therefore, to be found in short-sea Ro-Ro shipping.

“It will allow shippers to receive goods in a reliable, consistent, and timely manner while providing great economic and environmental benefits. Plans to implement the solution are progressing well with negotiations ongoing with Transnet for vessel berthing slots.”

The project will be rolled out across various ports including Cape Town, Durban, Port Elizabeth, Maputo (Mozambique) and Walvis Bay (Namibia) over the coming months. 

www.argonaftisshipping.com/south-africa

ways to maximise ROI with real-time transport visibility

Real time transport and logistics visibility is transforming the way transport organisations operate, providing them and their customers with live updates on the location and status of the vehicle fleet as well as the goods that have been ordered. Without this technology, companies do not have insights into deliveries, leading to inefficiencies and customer dissatisfaction, and an inability to keep up with competitors.

With the needs of customers in the region in mind, Seidor in Africa has developed a transport solution for SAP Business One, referred to as Transport One, that provides real-time, end-to-end transport visibility for SMBs that have implemented the ERP solution to automate key functions across their business.

Daisy Ndanyi, Head of Technical Account Management at SEIDOR in Africa, East Africa Region, says the Seidor Transport One solution was developed in consultation with Seidor’s large base of customers in the transport and logistics industry.

“What we have now is a seamless solution that integrates with SAP Business One and provides our clients with the information they need to optimise their transport and logistics operations,” she says. “Real-time visibility allows for accurate tracking and tracing of assets, and their location and status, throughout the supply chain.”

Ndanyi adds that any business that operates a fleet of commercial vehicles requires information about the whereabouts of any given vehicle at any time. Incorporating the latest GPS technology, Seidor’s solution is far more than just a tool to help commercial drivers to navigate from location to location.

“It allows SMBs to monitor vehicle location, geofencing, vehicle speed, odometer reading, and routes taken,” she explains.

As part of a modern mobile transport tracking software tool, the solution provides information that is critical to cost assessment, excellent customer service and improved efficiency.

The challenges of transport and logistics management across the African continent present significant opportunities for companies that can leapfrog traditional supply chain practices and adopt automation technologies.

Here are six key ways the solution can maximise ROI:

1. Tracking and calculating cost and profit per kilometre

Road-transport operators and logistics companies need to measure and control variable vehicle cost factors like fuel, tyres, maintenance, and repairs to gain accurate insights into actual costs and profitability.

2. Daily loading and delivery planning tools and reports

Labour planning and management is a challenge for many transport companies. Accurate and timeous reports make it possible to eliminate wasted time and spend while knowing what cargo needs to be loaded and delivered daily. Order delivery accuracy and ontime delivery are improved by planning tools that are part of the solution.

3. Monitoring fuel use

Fuel monitoring functionality reports fuel levels per vehicle, driver, and trip, recording important data from costs to consumption. This improves the company’s fuel efficiency, emphasising visibility around fuel spending and transactions at the driver level. This can result in significant fuel cost reduction and also eliminates fuel theft. A fuel tracking system also helps businesses determine if speeding is a common occurrence within the fleet.

4. Reduced downtime and increase asset availability

Preventive maintenance of vehicles minimises vehicle downtime, reduces costs and avoids breakdowns that result in safety and security risks. Alerts ensure that vehicles are serviced regularly, and parts are available when needed thanks to streamlined requisition systems.

5. Accelerated transactions and improved cash flow

By automating everyday financial tasks and integrating them with other business processes, transport businesses are always able to get the information they need when they need it. They can effectively track and access all customer-related information, for example, better servicing customers at every point of contact, helping ensure repeat business, and driving improved cash flow as a result of accurate monitoring and management of revenue and expenses. Timely billing based on real-time proof of delivery to maximise cashflow. This is enabled by the driver portal. An integration to mobile payments has eased the handling of cash to drivers and other payments.

6. Vehicle asset management

The solution enables automated tracking, vehicle details, licensing, tracking and reporting on vehicle values and costs, as well as annual depreciation as a result of distances travelled. The system also ensures that the business complies with all necessary regulations, enabling fleet managers to anticipate new regulations and avoid sanctions or fines.

“In addition to the many cost-saving and efficiency benefits, the solution is also affordable, quick to implement and integrates easily with SAP Business One,” says Ndanyi.

“The extremely positive response we have had from our SMB customers in the transport sector demonstrates just how beneficial this add-on is proving to be. We will continue to add features and functionality as the demand arises.” 

Unpacking SA's agri

international free trade agreements

The agricultural sector’s constant overall export growth over time is evidence that the public sector and private sectors are succeeding with gaining market access and diversifying South African exports.

By Linda Page, Chief Director Strategic Communication at Department of Agriculture, Land Reform and Rural Development

In 2021, the sector exported R181 billion’s worth of products to over 100 countries; with year-on-year positive growth of 6% over 5 years, and with a sustained positive trade balance. The South African agricultural export base is well diversified and not dependent on a few commodities. Government’s continuous historical and current efforts in international trade agreements and in negotiating international market access protocols is evidence of the Department’s active involvement, contributing to the success of the sector to remain and gain progressively foreign market access.

Foreign market access agreements result in improvements in the commercial conditions for the South African products exported to foreign markets. It can either be the scientific requirements that a product has to meet to enable access to a foreign market to mitigate the spread of pests and diseases, or it can be preferential commercial conditions such as reduced import tariffs and non-tariff barriers.

International Free Trade Agreements and Preferential Agreements

The Department is responsible for the technical level of trade negotiations as well as senior officials’ involvement in international trade agreements. South Africa participates in free trade negotiations as part of the Customs Union (SACU) with other blocks of countries.

It is therefore multilateral by nature but also spans across all products and not only that of agriculture and food. The dtic is the leading Department. Current free trade agreements are ratified through parliament and provide free trade for 60% plus of South Africa’s agricultural exports in value.

South Africa concluded the SADC-FTA in August 2008, which resulted in 90% plus of total trade in the region being free of duty. Africa also has less stringent food quality standards which provides an important role in South African food exports. The agreement also facilitates guidelines for sanitary and phytosanitary policies and guidelines for market access. In most cases, South Africa is able to meet the quality standards set and required by its regional trading partners. This has enabled South Africa to increase the export of value-added agricultural products.

The Department was part of the government team that recently concluded the AfCFTA that will

bring together all 55 member states of the African Union and provide a progressive market where a substantial amount of products will be free of tariff duties. In terms of numbers of the participating countries, the AfCFTA will be the world’s largest free trade area since the WTO. South Africa has not yet start trading within this agreement since a few matters are still outstanding.

SA has enjoyed free trade market access through SADC-EU EPA for more than 10 years

South Africa has enjoyed free trade market access through SADC-EU EPA for more than a decade. This agreement has to be constantly maintained when contentious issues arise that may risk the market access status. The SADC-EU European Partnership Agreement is a Free Trade Agreement concluded between the SADC EPA States and the EU. SADC EPA states comprise of all SACU member states plus Mozambique.

The SADC-EU EPA package contains, in addition to normal duty-free and partial duty concessions, a quota system. Currently the Agreement is under review for further improvements. With the exit of the UK from the EU, an agreement was concluded with the UK (SACUM-UK EPA) to retain similar preferences that SACU had with the UK.

Annex: South Africa’s diversified exports; the top 10 major agricultural product groupings by value in 2021

SA's top 10 agricultural product export groups by value during 2021

Product group description Exported value (Billion Rands)

Product group share in SA total agriculture exports (%)

Year -on-year product group growth (%)

Agriculture WTO definition 181 100.0 8.3

Top 3 products exported within the product groups (4HS)

Top 3 export markets by value

HS08

Edible fruit and nuts 65 36 4.3

HS22 Beverages, spirits and vinegar

21 11.4 14.0

Fresh or dried citrus fruits; Fresh or dried grapes; Fresh apples, pears and quinces Netherlands, United Kingdom, China

Wine of fresh grapes, incl. fortified wines; Waters, incl. mineral waters; Undenatured ethyl alcohol with strength equal or larger than 80%

Namibia, United Kingdom, Belgium

HS10 Cereals 15 8.2 28.8

HS15 Animal, vegetable or microbial fats and oils

HS20 Prepared fruits, vegetables and nuts

11 5.9 117.8

10 5.5 8.6

Maize corn; Wheat and meslin; Rice Japan, Botswana, Italy

Peanut oil and its fractions; Soybean oil and its fractions; Sunflower-seed, safflower or cotton-seed oils and its fractions

Fruit and vegetable juices; Preserved fruits, nuts and other edible plant parts; Vegetable, fruits, nuts and other plant parts preserved by vinegar or acetic acid

China, Botswana, Namibia

Botswana, Japan, Namibia

HS21 Miscellaneous edible preparations

HS17

Sugars and sugar confectionary

HS5101 Wool, not carded or combed

8 4.3 0.4

6 3.2 -23.2

5 2.7 14

HS23

Residues and waste from food industries &prepared animal feed

HS02

Meat And Edible Meat Offal

5 2.9 -1.2

Sauces; Food preparations Soups and broth Botswana, Mozambique, Namibia

Cane or beet sugar; Sugar confectionary, not containing cocoa; Sugars other Botswana, Mozambique, Namibia

Greasy shorn wool, not combed or carded; Greasy wool, not combed or carded, excl. shorn; Degreased shorn wool, not combed or carded

Preparations used in animal feeding; Meat flours, meals and pellets; Soybean oilcake

5 2.5 -0.1

China, Australia, Botswana

Botswana, Namibia, Zimbabwe

Fresh or chilled bovine meat; Frozen bovine ; Meat and poultry offal China, Lesotho, Afghanistan

Source: Global Trade Atlas, 2021 / SARS data

Total Agricultural products

Annex: South Africa’s sustained agricultural export growth to foreign markets that have preferential market access; by value in 2021

Export value in 2021 (Bn-ZAR) % share of export value under preferential agreements

Annual average growth rate 2017-2021

171 70% 6%

SADC-EU EPA 35 20% 9%

Top products exported in 2021 Top destination countries in 2021

SACU 33 19% 4%

SADC (Excl. SACU) 24 14% 1%

SACUM-UK EPA 13 8% 7%

Edible fruit and nuts, beverages and prepared fruits and vegetables Netherlands, Germany, Spain

Beverages, cereals and cereal preparations Botswana, Namibia, Lesotho

Beverages, Miscellaneous edible preparations and animal or vegetable fats and oils

Mozambique, Zimbabwe, Zambia

Edible fruit and nuts, beverages and sugars United Kingdom

Africa (Excl. SADC) 7 4% 4%

Edible fruit and nuts, beverages and miscellaneous edible preparations

Edible fruit and nuts, beverages and prepared fruits and vegetables

United States

Nigeria, Kenya, Ghana USA market under AGOA 7 4% 14%

SACU-EFTA 1 0.4% 1%

Edible fruit and nuts, beverages and prepared fruits and vegetables Norway, Switzerland, Iceland

MERCUSOR 0 0.2% 9%

Beverages, oilseeds & oleaginous fruits and edible fruits and nuts Brazil, Argentina, Uruguay

Source: Easydata / SARS data

The EFTA agreement was signed in June 2006 and came into force on 1 May 2008. The SACUEFTA FTA is a free trade agreement between members of the European Free Trade Association (EFTA) and the Southern African Customs Union (SACU). Countries are Iceland, Liechtenstein, Norway and Switzerland. South Africa is currently enjoying duty-free and quota-free market access on industrial, forestry and fisheries products. It is only the agricultural sector that is still subject to partial duty market access.

South Africa enjoys preferences in the USA

market based on a unilateral Act of the USA called the Agricultural Growth and Opportunities Act (AGOA). This Act has a limited life span and is not an agreement, although it gives similar preferences to that of a preferential agreement.

Mercosur is a customs union with two large economies, Brazil and Argentina, and two smaller economies, Paraguay and Uruguay. The agreement entered into force on 1 April 2016 and provides for concessions on over 1 000 tariff lines offered by each party from all sectors. The margin of preferences (MoP) ranges from 10% to 100%. 

Bringing Digital Infrastructure Services for Africa by Africa

SENTECH offers an array of digital infrastructure services, that enable connectivity and content delivery.

As an enabler of connectivity and content delivery, these offerings include:

Video and Audio Content

Provision of digital platforms for the delivery media services in South Africa and Africa through DTH, DTT, SENTECH Apps, AI enabled Set-Top-Boxes and 5G broadcasting. Towers With the wealth of strategically positioned Towers, Sentech provides broadcast coverage to more 100% of the population.

Facility leasing and co-location on its masts will provide managed infrastructure of both

passive and active infrastructure solutions with value added services for its customers.

Broadband

Sentech connects households, healthcare centres, education facilities and communities in South Africa through Satellite (VSAT), Fixed Wireless, 5G, and Cloud services.

Data Centre Infrastructure Provider

Sentech offers cloud and data hosting services, which will provide compute power, storage and disaster recovery capabilities.

Satellite Operations Sentech is developing a geo-spatial satellite which will enable broadband communication services in sub-Saharan Africa.

@Sentech Ltd.

@Sentech SOC Limited

@SentechLtd

Food: inflation, security and the gathering storm

Economics is boring. Or at least it can be a lot of the time. The global and local macro-economic landscape is always the context for the world that businesses operate in and so, as businesspeople, we use it to paint a picture of the background, headwinds and tailwinds that we face in day-to-day operations.

By Stephen Rushton, CFO of Empact Group

As interesting as this sounds, the reality is that for the most part, the macro economy oscillates within a very tight band. Our discussions become centred around relatively inconsequential details like whether inflation will be 4.3% or 4.5% and whether the rand dollar exchange rate will average 14.50 or 14.70 for the year.

But then, every 10 to 15 years, we find ourselves in a storm. Sometimes economic factors cause the storm (like the global financial crisis), and sometimes other factors are the cause. But regardless of what causes the storm, it always becomes (at least in part) an economic one. And when this happens, the world of economics becomes very significant, very quickly. That narrow band within which economic metrics usually move are replaced by volatile swings, with predictions by economists making the weathermen look good.

Our current storm is a confluence of the pandemic’s aftereffects, coupled with the complex unwinding of government’s stimulus attempts during the pandemic, ignited with Russia’s invasion of Ukraine then intertwined with “load-shedding”, “water-shedding” and the recent Transnet strike. Part of the side effect of all these factors combined is the high inflation currently being experienced globally and in South Africa.

Dislocation between producer price inflation and consumer price inflation

One of the features of this storm has been the dislocation between producer price inflation (PPI) and consumer price inflation (CPI). Historically, there has been a general correlation between PPI and CPI. Logic tells us this should be the case: when business input costs increase, those cost increases are inevitably passed on to consumers at some point.

However, over the past six months, year-on-year PPI in South Africa has exceeded CPI by around 8% on average. When it comes to food inflation over the same period, food PPI has exceeded

food CPI by around 4% on average. Whilst an oversimplification, this in theory could mean that the profit margin of food producers has reduced by between 4% and 8% as a result.

As consumers, we may think this is a good thing. The socialist hidden in some of us assumes that food producers have been making too much money for too long, and that this inflation dislocation presents a chance for that situation to normalise. Whilst there are no doubt instances where this is the case, realistically it isn’t the case in most instances.

This is borne out by the fact that the operating profit margin of food producers listed on the JSE averaged 8.4% in the past financial year. The current dislocation between food PPI and food CPI of 4% implies that these food producers don’t have much more room to absorb this inflation dislocation.

The situation could play out in several different ways…

There are a few ways that this situation could play out. The first is that food PPI reduces sharply in the months ahead, allowing food producers to return to a level of equilibrium between input costs (PPI) and selling prices (CPI). This is certainly the best possible outcome, for both producers and consumers.

The second possibility is that there is worse to come for consumers, with more significant food CPI in the year ahead as producers recover their higher input costs through prices. If food PPI doesn’t reduce sharply, this will almost certainly happen. The only uncertainty in this scenario is the extent to which producers will be able to fully recover their higher input costs through price increases to consumers.

In South Africa, it appears that consumers are feeling the impact of inflation with retail sales falling for four straight months to August; and the Bankserv Economic Transactions Index showing four consecutive months of decline to September. With further interest rate increases expected ahead, consumers are very limited in their capacity to

handle further price increases.

The third possibility is that producers will absorb the inflation dislocation. This has happened in the past, with producers becoming more efficient and thereby maintaining a sustainable profit margin. Only time will tell the extent to which food producers can generate efficiencies, but these are not likely to be at the level required to offset the inflation dislocation. To the extent that they can’t, their profit margins will be eroded. And this is the gathering storm.

An industry of food producers operating at losses or low margins is bad for everyone. Inevitably, some of these producers will go out of business which in turn, reduces supply. For those who manage to stay in business, low margins will translate to lower investment into building new capacity, which will further limit supply. This reduction in supply will not be quickly reversed, as establishing new capacity or revitalising old capacity, takes time (in many cases, a number of years).

Collectively this will drive food inflation even higher and for longer. But beyond inflation, reduced food supply will mean just that, less food being available. We often measure food security based on the availability of food raw materials. In practice, the majority of food consumed in South Africa is processed in some way. The processing of food is critical to get it into the form and to the location in which it is consumed.

SA is better off than the rest of the world in two respects… Whilst this outlook may be bleak, we as South Africans tend to make the mistake of thinking that we have it worse than everyone else. In some respects, we do. But when it comes to the economic storms that the world is facing, we as South Africa are better off than the rest of the world in two respects.

The first, is that our economic storm, whilst severe, is far more moderate than that being faced

in the rest of the world (to a large extent, we have the prudent approach of our Reserve Bank to thank for this). The UK has had three prime ministers in seven weeks and is navigating its way out of a disastrous economic experiment. Most of Europe is facing double digit inflation and the prospect of insufficient gas for their winter. And emerging market peers like Turkey and Nigeria have far less stable economic trajectories than ours.

The second respect is that we as South Africans have become resilient to storms – that is, resilient in dealing with crises that are outside our direct control. Our experiences with loadshedding, volatile exchange rates, social unrest and struggling infrastructure have built within us a resilience to crisis which is beyond what most of us realise. We have succeeded in spite of these storms in the past and we will no doubt continue to succeed in spite of the storm in the present.

We’re in the middle of the storm: consumers are hurting, interest rates are rising, and the risk of recession is ever present. But beyond this storm, there is another storm gathering on the horizon. It’s the storm of inflation dislocation and the knock-on effect for food producers.

The gathering storm may dissipate as they sometimes do. If it doesn’t, we’ll need to brace ourselves for tougher times ahead as we’ll move into a world that is ‘higher for longer’, even more than the one we’ve come to know. But we’re South Africans. And perhaps our ability to weather this storm, like we have so many before, will allow us to emerge in better shape than the rest of the world. 

Our experiences with loadshedding, volatile exchange rates, social unrest and struggling infrastructure have built within us a resilience to crisis which is beyond what most of us realise.

Expropriation Bill will kill

the necessary business of land speculation

The Expropriation Bill seeks to provide uniformity in expropriation procedures, as well as providing for the circumstances under which no compensation may be paid for any given expropriation of land.

By Mpiyakhe Dhlamini, Contributing Author to the Free Market Foundation

It is likely that the Bill will have to endure numerous challenges due to the likely economic impact if it becomes law. One serious concern arising from the Bill is that it seems to include an attempt to make land speculation illegal, or at least invalid.

The Bill lists five conditions under which land may be expropriated without paying compensation. The list is not exhaustive, however, since the relevant section of the Bill says nil compensation will not be limited to those conditions. Land that is not being used and the owner’s main purpose is not to generate an income but rather to benefit from the appreciation of its value, is the first condition listed.

How will government determine the purpose of the land owner?

The first question this raises is how the government will determine the purpose of the land owner. Will the government have to read the mind of an owner? What if the owner is simply trying to raise capital in order to generate an income? Will the burden of proof be on the owner to prove that they are in fact trying to do this and are not a member of the speculating class? And what is it exactly about speculators (people

who buy an asset in order to benefit from price appreciation), that makes them deserving of government-authorised theft of their property?

The speculator has always been blamed for all sorts of things, usually where the government is the real culprit and seeks to hide their involvement. In 2008, American President Obama blamed greedy speculators for the global financial crisis that started during that year. This is despite the fact that the crisis was preceded by years of monetary manipulation in order to make credit artificially cheap, most prominently through the government institution of central banking.

This is part of a long history that we won’t go over here. Suffice to say, it has become entrenched in our collective psyche that the speculator adds no value, and this is reflected in the Expropriation Bill.

What role does the speculator actually play in a market?

Yet it’s worth considering what role the speculator actually plays in a market, not only the market for land but in any market. Firstly, it must be noted that speculators take on risk, when a speculator buys land, they are taking on the risk that the price of that land will fall.

This implies that the speculator has to anticipate the demand/supply dynamics of the market they are in if they are to be successful. Therefore, successful speculators speed up the adjustment of market prices to the equilibrium price, the bad (not in a moral sense but in a competency sense) speculator will lose money while the good speculator anticipates future demand, and therefore helps sellers avoid selling their land for far less than what it would be worth. A market without speculators is a market without a significant group of buyers for genuine sellers. This practically means that prices are less volatile because of speculators. This can be illustrated with an example, say a farmer’s son

wants to sell a parcel of land that the farmer valued at R100 and needs to sell this parcel quickly because they want to move into a different profession, but the highest offer from other farmers at the moment is R50 (perhaps it was a bad season and the farmers don’t have too much money at the moment), then the son has to take that price and starts his new life with much less capital than would otherwise be the case. The speculator would see this and perhaps bid R75 for the parcel of land, they have no interest in farming, they just know that they can sell the land later for R100.

Speculators provide liquidity in a market

Speculators therefore help provide liquidity in a market. Simply by aiming to profit from the price of an asset, they ensure that the asset (land in this case) always has a buyer at reasonable prices for all sellers and provides the asset for those who need it, also at reasonable prices. Speculators don’t fall in love with assets, they sell when a buyer is willing to meet their target price. Therefore, the market is able to clear, speculators help market participants avoid shortages (which drive up prices) and excess supply (which drives down prices) allowing the market to clear closer to the “equilibrium” price.

The Expropriation Bill if it becomes law will kill the business of land speculation, and therefore the services provided by the speculator in assuming risk, allowing the market to adjust to the equilibrium price quicker and providing liquidity to our land market. Without these services we will have a much more inefficient land market. This is apart from the other negative effects of the Bill, including that it will depress property prices in the country as well as overall economic growth, and will therefore delay the absorption of our large numbers of unemployed into the job market, especially so in land-intensive industries like farming. 

SA’s shift to renewable energy must include plans for waste disposal

As South Africa increasingly looks to renewables to help address the country’s chronic energy crisis, independent power producers must ensure they have the right systems in place to dispose of wind and solar energy and associated storage equipment reaching the end of its life cycle.

World leaders attending the recent United Nations Climate Change Conference (COP27) have praised South Africa’s Just Energy Transition Investment Plan (JET-IP), which outlines planned investment to accelerate the country’s shift away from coal.

Patricia Schröder, the spokesperson for the

Renewable energy does generate waste

producer responsibility organisation (PRO) Circular Energy, says it is crucial that plans to increase the country’s use of renewable energy also cover waste management. “Our commitment to sustainability cannot simply focus on how we generate energy but must extend across the entire energy value chain, Schröder explains.

Wind and solar power and storage equipment typically have a lifespan of between 15 and 30 years, requiring power producers to plan well beyond their immediate waste disposal needs.

As countries around the world have increased their capacity to generate renewable energy in recent years, the volume of used wind and solar power and storage equipment that needs to be disposed of, has also steadily increased. This equipment typically has a lifespan of between 15 and 30 years

The International Renewable Energy Agency (IRENA) has estimated that globally photovoltaic panels used to generate solar power may create a cumulative 60 to 78 million tons of waste by 2050. IRENA estimates that in South Africa, this number could amount to 1 million tons by that same year.

Renewable equipment can be recycled

Schröder says producers must use the time at their disposal to consider the best solutions for the future disposal of the equipment they install now. However, producers already have existing obligations under the Extended Producer Responsibility (EPR) Regulations, which came into effect in May 2021.

These regulations aim to ensure that producers are accountable for the entire life cycle of the products they place on the market, from conception to post-consumer waste disposal.

Schröder says South Africa does have the capacity to recycle solar and wind generation and storage equipment. Between 80% of 90% of a wind turbine can be recycled, including the concrete and steel used to build turbine towers. Similarly, the glass and aluminium frame of a solar panel makes up more than 80% of its weight and both these materials can easily be recycled. Battery storage systems of all chemistries are recycled in South Africa.

EPR regulations will ensure compliance

Compliance with EPR regulations will help to ensure that equipment at the end of its life cycle is channelled to the appropriately licenced facilities.

“Without the correct systems in place, the very same equipment that was designed to be green can end up having a very detrimental impact on the environment,” Schröder says.

She says Circular Energy wants to help producers to care for the environment through a multi-faceted, best-practice strategy.

“PROs like Circular Energy can offer producers advice and services to help them to comply with regulations and contribute to putting in place the concept of a circular economy that can unlock opportunities for growth and employment.” 

beneficiation pathway An alternative hydrogen

Looking towards green technology solutions to support the global shift towards decarbonisation and the clean energy transition.

An alternate decarbonisation pathway is the gasification of biomass, particularly in the production of biofuels such as biodiesel and biojetfuel. Thyssenkrupp Uhde, part of the BioTfueL® project launched by a consortium of companies aims to achieve the conversion of Lignocellulosic Biomass into high-quality advanced biofuels via an indirect thermochemical pathway while simultaneously ensuring minimum impact on the environment.

“This involves gasification which is the process of taking solids and transforming them into gas, producing synthetic gas and ultimately advanced biofuels such as bio diesel, sustainable aviation fuels (SAF) and bio naphtha,” explains Nithesh Mohun, Senior Sales Engineer at thyssenkrupp Uhde South Africa.

The biofuels that are produced are free of sulphur, olefins, oxygenates and aromatics, making them suitable for use as drop-in fuels without the need to modify current infrastructure and vehicles or as a blend in all types of diesel

engine retrofits.

By-products of gasification are valuable

“The by-products of our gasification are also valuable,” adds Mohun. “The slag, for example, is used in roadbuilding and fly ash in the cement industry.”

The gasification processes, which is based on the Uhde® proprietary PRENFLO technology can be used to gasify a variety of solids including coke, coal, brown coal, petroleum and plant-based matter i.e., biomass. Biomass includes material such as sugar cane off-cuts, grass, wood chips, straw, forest waste and energy crops.

“Before introducing these solids or feedstock into our PRENFLO gasifier, which has a capacity of up to 1 200 megawatts, they have to be reduced into smaller particles,” explains Mohun.

“The solid plant matter is first broken down to pebble size through a technology known as torrefaction before being milled to produce a powder-like substance which is then introduced to the gasifier.”

Optimised production solutions for the beneficiation of biomass

“Taking into consideration that the global narrative centres on decarbonisation and green hydrogen, the classification of gasification of biomass by some as green hydrogen is accurate,” notes Mohun. “Gasification, irrespective of the source material, even if plant based, still produces CO2 so it cannot be classified as green hydrogen.”

“By contrast, green hydrogen is produced by the electrolysis of water based on 100% renewable feedstocks. Thus, biomass, together with the carbon capture process, can and should be viewed as a blue hydrogen solution especially when we introduce the gas treatment process to remove CO2. However, as the adoption of green hydrogen is still a few years away, gasification can be viewed as a transition technology.”

“Based on our Uhde® gasification process, we are able to design and implement optimised production solutions for the beneficiation of biomass. Our global footprint gives us access to a vast knowledge pool which, combined with a local presence and experience that spans more than six decades, perfectly positions us to offer end-to-end technology and service solutions,” concludes Mohun. 

Schematic showing the processes required to produce biofuels from biomass.

Pic above supplied by: Thyssenkrupp Uhde

and turbojet engines without the need for

JUST transition Dynamics of the local energy market and

By Aradhna Pandarum, Research Group Leader at the CSIR

The inclusivity of SMMEs and empowering them with knowledge of new energy resources and capability is key.

My passion for the energy transition space has its roots in touching lives through innovation. Developing new capabilities and innovation platforms to meet local energy transition objectives is an agenda priority for me and for the global energy industry.

Collaboration and innovation are key to rapidly producing better and more efficient designs. By adopting engineering simulation and test solutions, energy businesses can accelerate development turnaround time and output levels.

Effective relevant energy transition mechanisms ensure that the selected, resilient low-carbon energy technology streams not only address current energy shortages, but also contribute to a just society by improving the country’s employment rate, economic growth and inclusiveness.

SA is 12th largest source of GHG emissions globally

The current business challenge is a global one and is brought about by climate change with the increasing need to reduce greenhouse gas (GHG) emissions. According to a report published in 2021 by Bloomberg, South Africa is the 12th largest source of GHG emissions globally.

Almost half of these emissions emanate from the electricity sector. It is, therefore, prudent for us as a country to transition to low-carbon energy technologies and in doing so, ensure accurate relevant analyses of all contributing streams to this dilemma so that swift mitigation of risk responses can be factored in.

The energy transition is not a new concept; it is loaded with novel technologies being introduced at an unprecedented scale, impacting and affecting pathways that have a direct effect on environmental, social and economic indexes.

Techno-economics have always been central to the investment and implementation of large infrastructure for any successful energy technology platform. However, social justice facets

such as job creation, enterprise development, community participation, upskilling, reskilling, skills development and impact on health and overall livelihood are pivotal to ensuring that the energy transition is just.

Time is right for local pioneering

The time is right for local pioneering, especially after the impacts of Covid-19. The correct and attuned implementation of relevant solutions will be beneficial in alluring energy industry support programmes that will echo an expository narrative, showcasing insights into the local success of energy transition.

Current market challenges in the energy space include:

• Job losses from the coal sector due to lack of upskilling or reskilling.

• Salary and job description implications created by low-carbon technologies, including renewables and green hydrogen.

• The holistic social impact (and how to best determine the impact) of decommissioning coal-fired power stations and using the correct risk mitigation solutions that can be used to address these impacts.

• The current inability to ensure and quantify inclusivity, enterprise development and increased economic growth, including unforeseen delays in the procurement processes to purchase new energy technologies.

A solution? Enterprise development through empowering SMMEs in the energy sector

These are but a few challenges, however, a solution on the table is to expedite the energy transition process, whilst ensuring social justice imperatives, by directly addressing enterprise development through empowering small, medium and micro enterprises (SMMEs) in the energy sector.

An injection of astute acumen into a plethora of energy transition opportunities is available to them coupled with technical expertise that will certainly act as a resilient springboard for SMMEs on this exciting low-carbon energy journey. I am confident that this intuitive intervention will ensure significant economic growth. SMMEs employ 50-60% of the South African workforce and SMME inclusion will have an impact on reducing unemployment.

Unbeknown to many stakeholders, policy recommendations and alterations are continuously explored behind closed doors with the chief intent to drive economic growth and sustainability. SMMEs are not privy to this crucial information and are generally unaware of the opportunities being created and available to them.

An analysis conducted by the CSIR in Pretoria concluded that by 2030, 46 219 jobs will be lost by the decommissioning of coal-fired power stations, but the implementation of the energy technologies in the integrated resource plan will

create 34 997 jobs (indirectly and directly). This indicates that the resulting electricity sector will not be enough to make up for all jobs that are lost, let alone cater to market-related salaries at that time. Other economic diversification options cannot be ignored and must be explored speedily. Therefore, SMME empowering SMME differentiation through patents and collaborations are critical to significant changes within the energy transition space. 

Pandarum has a bachelor’s degree in Electronic Engineering from Howard College University of KwaZulu-Natal and a master’s degree in Electrical Engineering (Renewable Energy)

Aradhna Pandarum is a registered professional engineer and an internationally esteemed researcher with a demonstrated history of working in the utility industry. Skilled in renewable energy, power system design, power flow simulations, electronics, energy economics and power quality. Currently working on and managing research on all aspects of a Just Energy Transition in South Africa.

from the University of the Witwatersrand.

Mining companies need to adapt to a greener economy

Mining companies need to be on the alert as the legal and regulatory framework in which they operate is constantly changing and evolving around issues such as decarbonisation, exploration, resettlement, and employment equity. These all fall into ESGrelated considerations.

By

New policy documents and draft legislation relevant to the mining industry have been introduced, including initiatives to improve the process of resettlement and increase exploration investment, transitioning to a greener economy, and more stringent employment equity targets. Some proposals are controversial and will require the industry to give input to the government.

Nirvasha Singh, Partner, Carryn Alexander, Partner, Jaqui Pinto, Senior Associate, Giada Masina, Partner, Garyn Rapson, Partner & Lizle Louw, Partner at Webber Wentzel

The priorities identified in the Strategy are to improve the availability of geoscientific data, revise the licensing regime and attract exploration investment.

It is important to note that although these are guidelines, and therefore not law, stakeholders and the regulator will expect these processes to be followed. The guidelines set out fundamental principles for resettlement including: (i) meaningful consultation and conditions relating to meetings (and we would advise clients to keep documentary proof of the process followed); (ii) equality; (iii) the protection of existing rights; (v) minimising or avoiding resettlement; and (vi) using HDSA service providers. The golden thread throughout the guidelines is to ensure proper engagement, have a sufficient flow of clear and necessary information and to protect the rights of those being resettled.

Whilst the guidelines include many features throughout the resettlement process, which starts at the planning stages and ends even after resettlement with continued support, one of the most contentious parts of the guidelines is that it provides that mining cannot commence without a resettlement agreement in place.

We welcome these guidelines, which reflect some of the global principles surrounding resettlement laid out by bodies such as the ICMM, and contextualise them within the South African framework, however certain issues remain. We will await to see how the DMRE deals with resettlement especially resettlement agreements in the wake of these guidelines.

Decarbonising the South African economy

In September 2022, a just transition framework was approved by Cabinet. It sets out a climate-resilient development pathway for South Africa, which affects every sector, with a focus on improving lives, preserving jobs, being people-centric and ensuring resilience. The concept of a just transition requires a contextual look at the needs of a country and this framework provides a South Africa specific definition of the just transition.

The recently introduced Carbon Tax Act is intended to incentivise businesses to decarbonise

their operations. The tax has been introduced in three phases, with the first phase being extended to 31 December 2025. The proposal by National Treasury is to increase the rate of carbon tax in dollars which will inevitably lead to businesses being hard hit.

Whilst Government recognises that not every business is in a position to reduce its carbon footprint completely, it is vital for Government to be in alignment with the commitment to the Paris Agreement. It is therefore imperative for businesses to invest in projects which will enable it to reduce its carbon tax liability in the most sustainable way possible. Business is therefore encouraged to invest in carbon offset projects which will allow it to reach its' net zero goal.

The Employment Equity Amendment Bill

The Employment Equity Amendment Bill, which we expect will become law in September 2023, provides for the Minister of Labour to identify national sectors and, after consultation (not necessarily agreement) with those sectors, impose numerical sector targets to ensure equitable representation of suitably qualified people from designated groups.

These sector targets are hard-coded, with punitive measures for non-compliance, and it could be argued that they amount to quotas, which could open them to Constitutional challenge.

Employers that are declared non-compliant can raise justifiable grounds for non-compliance, but this is cold comfort. Firstly, there will still be a finding of non-compliance and the directorgeneral or minister has the discretion to rule on it. Secondly, non-compliance is absolute. An employer that is 99% compliant will be treated in the same way as one that is only 5% compliant. The penalty for non-compliance will be a fine, as laid out in the Employment Equity Act. 

Economic progress

versus CARBON FOOTPRINTS

versus

COP27 has just wrapped up in Egypt with the final push being an argument over an economic consequence of global warming – in this case compensation for any negative consequences for vulnerable poor countries. Yet was that the right conversation to have? Below I make a case for the focus to be on economic growth instead.

By Garth Zietsman, statistician and writer for the Free Market Foundation

In 2001 Bjorn Lomborg published a book entitled The Skeptical Environmentalist. In the chapter on air pollution were two graphs that showed changes in particle and SO2 pollution in 48-49 cities increased (as average income in 1985 terms) – both in 1972 and 1986. Pollution first increased with rising incomes, reached a maximum at $3 000, and then declined as income increased further.

The peak pollution for both particles and SO2 was at the same average real income in both 1972 and 1986 – although the 1986 peak was lower in 1986 than 1972. For a given income, the lower levels of pollution in later years are due to increased efficiency over time. The fact that pollution peaks at a specific level of income means that when people earn enough to satisfy their material needs, they start to care about other things more –such as environmental quality.

Hope in greater technological efficiency

Now for those who are concerned about the state of the environment one obvious lesson is that there is hope in greater technological efficiency. Another lesson is that they shouldn’t expect improvements where people still have unmet material needs. I was motivated by this finding, and the Climate Summit in Egypt, to find out whether something like this phenomenon exists with carbon footprints across countries. It does.

Changes in per capita carbon footprints go from increasing to decreasing at a log GDP pc of about 3,26 – equivalent to a current GDP pc of

$4 300 and somewhere between Ghana and Papua New Guinea. Clearly the same phenomenon which Lomborg reported.

We should expect each person’s carbon footprint to start decreasing after they earn above a certain amount. Note that the turning point is where peak carbon production occurs, so the further a country exceeds it the better. Most of the large, heavy CO2 producing countries already have higher incomes than the turning point figure but not enough to show big decreases in per capita carbon footprints.

How do we achieve growth and greater efficiency?

If the country isn’t already at that income level the only way to get there, and past it, is economic growth. Economic growth will enable vulnerable countries to build defences against any risks e.g., sea barriers for rising sea levels, better flood defences, improved fresh water supply and management, and stronger buildings to handle weather extremes; and it is both a better way than compensation and will make compensation easier.

Improved cognitive skills, open and free economies, and dependent on those, new technology, are the proven ways to achieve growth and greater efficiency. Farsighted green-energy advocates should promote these ways, including the free market bit. 

Future technologies driving the SA mining industry

The future of sustainable and profitable mining in South Africa requires mines to embrace and adapt to ever improving and modernised mining methods.

The Fourth Industrial Revolution presents a unique opportunity for manufacturers of mining systems and equipment to collaborate with their clients on developing solutions to increase efficiencies, safety, profitability and the life of mines (LoM).

MEMSA is a member-based cluster, with a vision to position local mining equipment manufacturers as cost competitive and innovative – the preferred suppliers to local, regional and global markets. While this vision seems ambitious, the reality is that SA’s long, rich mining history has provided fertile ground for the development of an innovative mining equipment industry, with a great depth of expertise. It consists of agile manufacturers, specialised in meeting the needs of the local mining industry, as well as regional and global customers.

Supporting innovation

In this context, collaboration is key, and MEMSA is working with a wide range of partners to support innovation and technology development, including the Mandela Mining Precinct, Council for Scientific and Industrial Research (CSIR), Minerals Council of South Africa, universities, and higher education institutes and research communities.

The Precinct, a landmark collaboration between the private sector, represented by the Minerals Council of SA, and government, via the Department of Science and Innovation, aims to develop and facilitate technologies required to ensure the sustainability of the South African deeplevel, hard-rock mining industry, which faces serious safety and productivity challenges as shafts move deeper underground, and lower grades of ore are mined.

Since its inception, MEMSA has played a key role in facilitating member involvement in SAMERDI research programmes driven by the precinct. The South African Mining, Minerals, Extraction Research Development & Innovation initiative currently comprises of five research programmes: Life of Current Mine (LOCM), Mechanised Mining Systems (MMS), Advanced Orebody Knowledge (AOK), Successful Application of Technologies Centred Around People (SATCAP), Real-Time Information Management Systems (RTIMS) and the Test Mine.

“The need to enhance mine safety and increase productivity, together with revolutions in the use of data and energy technologies, are creating pressure for rapid and innovative technology development,” explains MEMSA CEO, Lehlohonolo Molloyi.

Improving access to real mine testing environments

The precinct’s Test Mine programme is set to improve access to real mine testing environments. MEMSA contributed funds to the feasibility study for the establishment of an underground Test Mine facility at Royal Bafokeng Platinum’s Maseve Mine, and the CEO continues as representative on the Test Mine Steering Committee. Members are expected to commence use of the facility in 2023.

Once technologies have been perfected and proven, they must be brought to the attention of the market – and this is the key objective of another project on which MEMSA is working with the precinct. Mining TARA is an equipment database undergoing its second phase of development; the online platform will provide access to the capabilities and offerings of local OEMs while providing researchers with detailed information on available technologies.

MEMSA introduces members to relevant research programmes

The CSIR is an integral partner in the precinct,

and MEMSA has introduced members to relevant research programmes. The CSIR Hydrogen Trackless Mobile Machines (TMM) programme focuses on hydrogen development and usage through electric vehicle (EV) enablement by converting existing TMMs and assisting the development of new TMM designs.

Local OEMs have been identified as key partners for the programme. Further focus areas for collaboration include the CSIR’s Factory Digital Twin, Learning Factory, 3-D printing and laser refurbishment facilities.

These novel technologies require new skills in engineers and artisans alike. MEMSA has recently completed a merSETA-funded research programme into 4IR-related skills needs in the industry. The study revealed SA manufacturers are selectively adopting new technologies, including IoT, 3D printing, Computerised Machine Maintenance Systems (CMMS), robotics and automation. Products manufactured increasingly include or link into data collection and transmission eco-systems.

While universities are responding rapidly to the need for new skills, it is more difficult for the under-resourced TVET system to adapt. New skills are best acquired in modular form through short courses – which digitally can be made widely available. The study recommended continued assessment and collaboration on sourcing courses for development at both artisan and engineer-level.

Safety a powerful driver for technology development

Safety remains a powerful driver for technology development, and MEMSA members participate in the Minerals Council-led TMM Regulatory Alignment Project in preparation for the implementation of ‘Level 9’ safety regulations – requiring trackless mining machinery to automatically slow or stop to prevent collisions.

The need for integrated sensor, transmission,

and mechanical technologies from OEMs and OTMs, ensuring a system that is safe and efficient, is demanding new levels of collaboration among mines, manufacturers and research partners. The process has involved learnings by all involved, which may underpin new technology partnerships.

Through the SATCAP programme, members have actively participated in training-exposure sessions on VR and AR skills development solutions; their application to modern drill rig operator and miner training for safer mining, VR and AR training methodologies to support a modern workforce at the University of Johannesburg’s Mock Mine and the Sibanye-Stillwater Digital Mining Laboratory (DigiMine) at the University of Witwatersrand and Virtual Reality Centre and at the University of Pretoria (UP).

Supporting innovation

In 2022 MEMSA held its inaugural Innovation Awards to celebrate local excellence in technological development and manufacturing capability supported by SAMERDI. “A lot of decision-makers in procurement tend to consider international mining equipment as superior, when in reality our local OEMs are on par with major international players. The recent acquisition of some of SA’s leading mining equipment OEMs by major international players further confirms this,” comments Molloyi.

“Global manufacturers have access to significant funding from their parent companies and have government support. This majorly impacts the investment these companies can pump into R&D. From that perspective, a local OEM might build a prototype, only to find its innovation stymied by technological advances imported from better funded and resourced global companies,” adds Molloyi.

Nevertheless, local manufacturers continue to leverage expertise and innovation to meet local challenges, to offer solutions for local and global markets.

“MEMSA thus welcomes the extension of, and refinements to, the 11D tax incentive for R&D which focuses on the development of novel knowledge and technological solutions. The nature of the industry requires more funding for prototyping and the commercialisation phase of product development,” Molloyi says.

Awards category winners

• Hard Rock Mining Equipment (the Navin Singh Award) Hydro Power Equipment (HPE) for the development of the Isidingo Drill and Drill Guide

• Soft Rock Mining Equipment Rham Equipment for the development of battery electric driven LHD, dump truck and land cruiser

• Mining Infrastructure and Mineral Processing AZMET Technology & Projects for the AZMET Cyanide Removal Process (AZ-CRP®)

• Safer and Healthier Mining Mine Support Products for the Rocnet Modular Safety Net

• Improved Productivity Hydropower Systems for the HV212 EOD Hydrovessel

• Emerging Small Enterprise Gravitas Minerals for the Optima Classifier™

Exciting innovations are happening across the cluster’s membership including the development of:

• battery electric mining vehicles by members including Rham Equipment, Fermel (personnel carrier) and Battery Electric (diesel locomotive conversion)

• innovations in explosive casings (NXCO)

• the development of trackless mining machinery suitable for mechanised mining, with sophisticated safety mechanisms; innovative hydro powered equipment

• data sensing devices and systems for better safety and productivity 

Promoting sustainable

opportunities linked to mining

An impactful, mutually beneficial and outcomes-based engagement platform has been established to strengthen relationships between Impala Rustenburg and the local business community.

The Impala Mine Host Community Business Forum Engagement Platform is a legitimate and recognised structure that will enable business forums to build trust and improve stakeholder relations, which in turn will sustain operational stability.

The engagement platform will provide the local business forums with information on inclusive preferential procurement opportunities, enterprise and supplier development (ESD) initiatives, and social and labour plan procurement (LED) opportunities.

The engagement platform will also facilitate Impala’s updates and progress reports on procurement spent to the business forums and provides a structure for Impala to receive feedback from mine host community business forums.

Two-way communication is the cornerstone of good stakeholder relations...

Opportunity to change narrative between mining companies and local business forums

“We believe that this is a promising opportunity for our business forums to build a positive relationship with Impala, and an opportunity to change the narrative on the relationship between mining companies and local business forums,” says Neo Kgaje from Mine Host Community Business Forum (MHCBF) representing the collective of 14 business forums.

“We look forward to building a two-way engagement platform where recommendations and proposals are put forward to enable positive outcomes that will impact the local economy in a manner that is inclusive, transformative and progressive in nature,” he adds.

Mark Munroe, Chief Executive at Impala Rustenburg, says: “Impala Rustenburg’s commitment to the development of SMMEs in our mine communities is demonstrated through our investment in numerous impactful initiatives that form part of our socio-economic development plan, which assists minecommunity small, medium, and micro business owners to formalise their businesses.

Impala launches Economic Inclusion Centre for SMMEs

“We provide a five-day training programme and an intensive 12-month ESD training programme, which has benefitted 400 SMMEs since our ESD initiatives launched in 2021. We also launched an Economic Inclusion Centre that is open to SMMEs across all our mine communities and is designed to provide a place for mine community SMMEs to gain assistance with formalising their businesses, access short courses and use the various business facilities available at the centre,” Munroe adds.

“The Mine Host Community Business Forum Engagement Platform is aimed at fostering a spirit of collaboration and ensuring the socio-economic well-being of Impala mine-community SMMEs. Two-way communication is the cornerstone of good stakeholder relations and is essential to ensure that all parties derive the benefits of procurement opportunities, ESD programmes and other initiatives.

“We are excited to further open the channels of communication with the SMMEs in our mine communities – and to work together to improve the future of Rustenburg,” Munroe concludes. 

Does Net-zero still feel miles away?

Does Net-zero still feel miles away?

Does Net-zero still feel miles away?

Tackle supply issues and reduce your carbon footprint with our range of integrated manufacturing solutions.

Tackle supply issues and reduce your carbon footprint with our range of integrated manufacturing solutions.

Make it flexible. Make it sustainable.

Make it flexible. Make it sustainable. Make

Tackle supply issues and reduce your carbon footprint with our range of integrated manufacturing solutions. it flexible. Make it sustainable.

Atlantis SEZ harnessing the green economy

The Atlantis Special Economic Zone for green technologies aims to harness the green economy for growth and increase job opportunities by driving sustainable development and job creation.

It is a key element in the Western Cape government’s Economic Recovery Plan and the scheduling of the company as a provincial business enterprise bodes very well for its role as a game changer in the renewable energy sectors of the Western Cape’s economy.

The eco-industrial park seeks to attract investors who embody the elements and ethos of green technology manufacturing. The Atlantis SEZ is run on the principles of reduction of carbon and promotion of resource efficient business activities culminating into a socially inclusive economy. With the Atlantis Special Economic Company (ASEZCo) forming part of a mature and effective investment ecosystem in the Western Cape, your investment is sure to land in a credible administration in an efficient and cost-effective manner.

Atlantis presents itself as the ideal location from which to compete in Africa and the world’s green technology markets by offering green infrastructure, a strong support base from government, as well as fruitful business relationships for investors, as you work closely with the locals and help uplift the community. Green skills development and growing technical capabilities within the Atlantis community are part of the ASEZCo’s strategic objectives, aligned to the legislative requirement of the Special Economic Zones Act to grow the regional economy and drive socio-economic impact.

Driving growth through green economy innovation and sustainable job opportunities remains at the heart of what the ASEZCo does. These principles will contribute towards growing the regional economy in a meaningful and impactful way and enabling the regeneration of Atlantis to become a leader in green economy manufacturing, within an eco-industrial park that puts sustainability, and social inclusion at the top of its agenda. www.atlantissez.com