South African Airways could sell shares to the public as the state-owned carrier seeks ways to end years of losses and reduce the need for bailouts, according to people familiar with the matter.
The move would enable the government to cut its stake in much the same way as it did with former phone monopoly Telkom SA, almost two decades ago, said the people, who asked not to be named as the information is not public. However, the carrier would first need to make progress with a turnaround plan designed to reach break-even in three years, they said.
While the sale of a stake to an equity partner has been aired repeatedly over the years, this is the first time it’s been suggested that SAA should list on a stock-exchange. Pretoria-based Telkom’s initial public offering in 2003 raised almost $500m and the government’s shareholding is now just under 40%.
SAA declined to comment
The airline’s Chief Executive Officer Vuyani Jarana is facing renewed pressure from his bosses in government, which last month put aside R5bn to help SAA repay debt.
Last week, Finance Minster Tito Mboweni said it was his preference to shut down the carrier rather than continue to stretch state finances, while his counterpart at the department of public enterprises, Pravin Gordhan, warned on Monday that “radical things need to be done” for the airline to survive.
More immediate plans than the share sale include holding discussions with potential commercial joint-venture partners including Air Mauritius, one of the people said. That could lead to cost savings on routes to the Asian-Pacific market as the airlines would share operating costs.
SAA will also consider a resumption of flights to Abuja, the Nigerian capital, which it abandoned in 2017, the person said. The carrier would apply for a local license - or find a partner - to help Nigerians travel to the U.S.
Jarana, 48, a former executive at South African mobile-phone market leader Vodacom, was hired a year ago, in part for his experience in the private sector. He also has no connection with previous management, which has been embroiled in the corruption scandals that plagued state-owned companies during ex-President Jacob Zuma’s almost nine years in charge.
SAA has had an equity partner before. The government sold 20% of the carrier in 1999 to Swissair, which pioneered the concept of an alliance anchored via minority stakes, only to buy the shares back in 2002 when the European carrier went bankrupt.
South African researchers say they have made bricks using human urine in a natural process involving colonies of bacteria, which could one day help reduce global warming emissions by finding a productive use for the ultimate waste product.
Although make from urine, the bricks do not have any foul smell.
The grey bricks are produced in a lab over eight days using urine, calcium, sand and bacteria. Fertilizers are also produced during the processes.
The bricks are made using urea — a chemical found naturally in urine and also synthesized around the world to make fertilizer. The process of growing bricks from urea has been tested in the United States with synthetic solutions, but the new brick uses real human urine for the first time, the researchers said.
“We literally pee this away every day and flush it through the sewer networks,” said Dyllon Randall, a senior lecturer at the University of Cape Town’s civil engineering department who is part of the team that developed the brick. “Why not recover this instead and make multiple products?”
One obstacle preventing mass production: the bricks use huge amounts of pee. To make a single brick requires about 20 liters of urine – a couple of weeks’ worth of wee for a typical adult.
“So, I get it from the boys bathroom opposite the laboratory. I put a little sign up and all the university boys contribute to my research,” said Suzanne Lambert, who proved the concept for the research by making the first brick.
“I definitely see commercialization in the next decade or two, but there is still a lot of lab work to be done,” she said.
Durban just added an impressive architectural and engineering marvel to its portfolio of landmarks. The Mount Edgecombe highway interchange was officially opened by transport minister Blade Nzimande and the South African National Roads Agency (Sanral) on Wednesday.
The Mount Edgecombe Interchange linking the N2 and M41 highways.
The interchange boasts a first for Africa, according to Sanral CEO Skhumbuzo Macozoma in an interview with the state broadcaster. He says it features the continent’s longest flyover ramp that stretches for one kilometre, linking the M41 eastbound with the N2 southbound, connecting surrounding areas like Phoenix and Umhlanga with Durban.
The Mt Edgecombe Interchange's flyover ramp stretches for about 1km and is dubbed Africa's longest.
The agency undertook major upgrades to the interchange from April 2013 to ease "chronic congestion of traffic" in the area, notorious for long waiting times, especially during the festive season, when South Africans flock to the coastal region.
The agency intends cutting travel time between the areas the interchange links from 25 minutes to one minute on average. The old interchange had traffic lights increasing waiting time; it has now been converted to a completely free-flowing system with limited stops, says Henk Kaal, resident engineer on the project.
New data from the Central Energy Fund of South Africa shows that the petrol price is set to drop by 3c in November.
The possible decrease is attributed to a strengthening rand and a decrease in Brent crude oil prices.
South Africa’s petrol price jumped to a record-breaking R17.08 in October; this would be the first decrease in eight months.
The South African petrol price is set to drop by 3c per litre in November, the first drop in eight months, new data from the Central Energy Fund (CEF) shows.
But the news is not all good: the diesel price is set for a massive 35c per litre hike.
The possible decrease in the petrol price is attributed to a strengthening rand, and the global decrease in Brent crude oil prices, data from the CEF released on Wednesday shows.
The CEF is a state-owned entity mandated to manage PetroSA and Strategic Fuel Fund (SFF) to secure South Africa’s national energy security.
Hugo Pienaar, senior economist at the Bureau for Economic Research at Stellenbosch University, said things are looking increasingly promising for consumers in South Africa.
“It is not only that the rand, on average, performed stronger against the US dollar, but the oil price also fell sharply from around $86 a barrel in early October, to around $76 today,” Pienaar told Business Insider South Africa.
He said the petrol price may decrease slightly or remain the same as October prices when a formal determination is made.
The local petrol price jumped to a record-breaking R17.08 inland in October, and R16.49 at the cost.
“I think the most important point is that the price [of petrol] will stay roughly the same, which in itself is positive after the sharp increases,” said Pienaar.
President Cyril Ramaphosa set up an inter-ministerial committee in July to investigate possible interventions the state can make to lessen the effect of petrol price hikes on South Africans.
The initial report was set to be completed by September, but has now been postponed to the end of November, energy minister Jeff Radebe said this week.
Larochelle Smit has endured attacks for dating outside her race but when she got a racist Facebook message from the mother of a man she used to date, she decided enough was enough.
Speaking to Newsmen on Tuesday, 28-year-old Smit said she was shocked when nurse Elaine Jacobs sent her the "absolutely disgusting" private message last month.
Jacobs has since claimed that her Facebook account was hacked. The Life Healthcare group, which the nurse listed as her employer on her profile, has stated that it will not utilise Jacobs' services at any of its hospitals.
The message, which has caused outrage on social media, reads: "Ek meen jy's n boere sa meisie maar jy wil soos n kardasian lyk??? En met k***** uit gaan?? [sic]" (I mean you are a Afrikaans South African woman but you want to look like a Kardashian? And date k*****?)
Smit explained that she dated Jacobs' son about a decade ago and that Jacobs had kept her as a friend on social media.
"I don't know if she has any ill feelings. She has seen photos of me and my boyfriend. This woman somehow felt the need to message me and enquire [about my makeup and boyfriend]."
She said she showed the message to her boyfriend, who tried to calm her down.
"From the time I have started dating outside my race, I have been bullied and been a victim of such awful comments. Largely from the Afrikaner community. I have reached a point where enough is enough."
Smit, who is based in Sandton but is originally from Durban, said former eThekwini speaker Logie Naidoo was helping her lay a complaint with the South African Human Rights Commission.
She has also opened a case at the Sandton police station.
Replying on Facebook to Smit in the comments section on Sunday, Jacobs said: "Hi there guys facebook just let me know about this and this is the first time ive ever seen this comments i asume my facebook was hacked,im trully sorry about this. And would ever in my life comment something like that.
No longer employed at Lifecare
Life Healthcare human resources executive Chris Gouws confirmed on Tuesday that Jacobs was not currently employed by Life Anncron Hospital in Klerksdorp, as stated on her Facebook profile.
"We can, however, confirm that she is a former nurse having resigned from the hospital in 2012. Thereafter, she worked for a nursing employment agency and her last shift at the hospital as an agency nurse was in October 2017."
Gouws said racial hate speech was a very serious matter and the behaviour contravened the company's values and policies.
"Despite the fact that Ms Jacobs was not in our employ at the time of her post, we have reached out to the nursing agency and informed them that Ms Jacobs' services are not to be utilised at any Life Healthcare hospital. The group has also made the decision that Ms Jacobs' services will not be utilised at any Life Healthcare facility in the future."
Argentina's citrus-growing regions were affected by frost at the end of winter, high temperatures in summer, plus excessive rain that delayed harvest for about a month. The combination affected both quality and total output.
South Africa, on the other hand, had improved weather conditions the two main citrus-growing provinces, the Eastern Cape and Limpopo. An increase in planted area also helped.
The Eastern Cape and Limpopo account for 80% of South Africa's lemon and lime production, and increases there helped offset lower production in the drought-hit Western Cape.
But the European party for South African exporters may already be over, says Eddy Kreukniet of Exsa Europe
"We've now entered the final weeks of the season and the market it decreasing with the entry of Turkish and Spanish citrus."
Growers who, during this period, did not plant a mix of products, might be headed into a difficult year, warns Kreukniet.
Durban Poison Cannabis Lager - South Africa’s first dagga-infused beer - launched in the country in September.
It costs only R18 for a 350 ml bottle and is available at selected Tops at Spar liquor stores in Gauteng and KwaZulu-Natal, Graeme Bird, co-founder of Poison City brewing, said. Cape Town will get the beers early next week
“It’s a light-bodied, easy-drinking beer perfect for hot weather or chilling next to the beach,” Bird told Business Insider South Africa.
The 4% alcohol beer doesn't contain tetrahydrocannabinol (THC), the psychoactive component of dagga, but uses hemp oils to give the beer its distinctive taste.
Hemp is a less psychoactive dagga strain.
“It will, however, make you happy with its unique crisp flavour and easy-drinking vibes,” Bird said.
Durban Poison Cannabis Lager was released on September 17 - a day before the South African constitutional court legalised dagga consumption in South Africa.
“People said we had an in with the chief justice,” Bird said jokingly.
He, however, clarified the use of hemp in production was legal in South Africa before the constitutional ruling.
The beer is named after Durban Poison, a popular dagga strain.
There has been a global trend for dagga-infused beer with both Heineken and Molson Coors recently announcing that they’ll be releasing dagga-infused beer in the near future.
Poison City brewing, backed by RCL Foods CEO Miles Dally and Spar CEO Graham O’Connor, was founded in 2015.
Other than Durban Poison, the company also produces The Bird, a lager, and The Punk Rocker, an ale.
Bird said they specifically positioned the beer to be accessible to the larger South African public.
“South Africans have an appetite (for) craft beers and this lager is developed specifically for that easy-drinking market,” he said.
Household consumption slipped in the second quarter of 2018 as people adjusted their spending habits following the VAT hike and fuel price increases, according to the South African Reserve Bank’s quarterly bulletin released on Tuesday.
The SARB noted that household spending was also suppressed by “diminishing wealth effects” in the first eight months of 2018, as the FTSE/JSE All-Share Price Index fell on a combination of negative sentiment towards emerging markets and domestic policy uncertainty, relating to how land expropriation without compensation would play out.
Consumers have been hard hit by the VAT hike from 14% to 15%, effective from April 1 and five successive months of fuel price increases.
The research note by the central bank painted a grim picture of the economy
falling into recession in the second quarter of 2018, with negative gross domestic product growth in the first six months of the year and unemployment rising to 27.2% in April, May and June.
However in contrast to falling consumer expenditure, state spending increased with government contributing positively to GDP figures in the second quarter of 2018.
Household credit growing steadily
The Reserve Bank reported that while the household credit market remained “very subdued” during the second quarter of 2018, growth in household credit extension continued to trend steadily upwards over this period. Loans to the private business sector remained subdued and increased at a slower pace.
While households are battling the impact of the VAT increase, government’s finances are in slightly better shape due to the one percentage point hike. Former Finance Minister Malusi Gigaba said in February that the VAT hike was expected to
raise an additional R22.9bn.
The central bank's quarterly bulletin stated that the cash book deficit of national government was much smaller in April, May and June, than the previous year as revenue was boosted by the tax hikes.
The rand decreased against the US dollar by 10% in the second quarter, following the local currency’s relative strength in the first part of the year.
The Reserve Bank said the rand’s weakness was largely due US dollar strength, higher international oil prices, increased global inflation and risk aversion towards emerging markets.
Smoking dagga can still get you fired, under the right circumstances. And staying away from cannabis – at least just before you go to work – could still be a legitimate requirement for some jobs.
But things got a whole lot more complicated after the Constitutional Court on Tuesday said the use of dagga is not a criminal act.
And during the two-year period the ConCourt gave Parliament to bring legislation in line with the Constitution, things are going to be particularly difficult when it comes to people getting high on the job, experts say.
"This is a curveball," Richard Malkin, managing director of company wellness provider Workforce Healthcare, told Business Insider South Africa after the Concourt judgment, even if, ultimately, "nothing is really going to change from a workplace perspective."
South Africa's highest court on Tuesday allowed the private use of marijuana, upholding a lower court's ruling that found the criminalization of cannabis was unconstitutional.
Occupational health and safety rules demand that companies keep the workplace safe, and that includes making sure nobody operates dangerous machines while inebriated – whatever the substance of choice.
For jobs involving heavy machinery, Malkin says, policy should require employees to disclose, up front, if they are using tranquillisers, for instance, even if under the direction of a doctor.
"The requirement is that you can't be under the influence of any mind-altering substance; whether it is legal or illegal doesn't really come into play."
Jobs in finance, or customer-facing jobs such as call centre agents advising customers, should also come with policies on inebriation.
But testing for dagga use is not as straight-forward as a breathalyser test for alcohol. The common, cheap, and fast urine test for cannabis actually detects a metabolic product that can linger for days – well after the user is no longer mentally affected.
So what happens if that test shows dagga use, and you tell the boss you smoked dagga days before? Right now, at least, Malkin believes the only thing a company could do is ask for a spectrophotometric test, which takes around two days and costs around R2,000.
In the meantime, the employee will have to be temporarily suspended from sensitive duties, as a precaution.
The result of such a test could be grounds for dismissal, speculate labour specialists who were still studying the ConCourt ruling, on the basis of dishonesty. Using dagga may not be a firing offence, but lying about it could be.
First, though, there could be a considerable fight about the whole process.
"Someone may have okayed drug testing by a company in a contract, but now that company can no longer look at THC [the active ingredient in cannabis]," says Quintin van Kerken, of The Clear Option, an organisation that works in the cannabis and addiction-treatment industry.
"It is pointless, because THC now falls under your right to privacy, so they can't do anything with a THC test."
Van Kerken believes there will be test cases about cannabis intoxication and medicinal use of cannabis in the workplace – perhaps soon – but until then there will be considerable confusion about the matter.
In the meanwhile, employees and employers both had better look at the exact wording of policies around drugs and inebriation at work, because a blanket reference to "alcohol, illegal drugs, and prescription medication", such as those now commonly found, don't strictly apply do dagga anymore.
In President Cyril Ramaphosa's statement on the Economic Stimulus and Recovery Plan for South Africa, he highlighted the visa changes approved by the cabinet on Wednesday.
One of the key economic reforms mentioned in the president's speech was the country's visa regime, focusing on the amendments that will be made to regulations on travel of minors to South Africa, the list of countries requiring visas to enter South Africa, an e-visas pilot that will be implemented, and visa requirements for highly skilled foreigners that will also be revised.
"These measures have the potential to boost tourism and make business travel a lot more conducive. Tourism continues to be a great job creator and through these measures we are confident that many more tourists will visit South Africa," says Ramaphosa.
The full details of the visa reforms and waivers have yet to be made available but will be officially gazetted in October - ahead of the busy December holiday period.
Expected visa changes:
Cabinet received a joint report from the Ministers of Home Affairs and Tourism - Malusi Gigaba and Derek Hanekom - which reiterate the visa-related reforms that will make it easier for tourists, business people and academia to visit South Africa.
The biggest issue is the hoops foreign tourists have to jump through when travelling with minors and obtaining unabridged birth certificates, and changes to this regulation will also be included in the reforms, the state has confirmed.
There are also negotiations on visa waivers and relaxation of visa requirements from certain countries which are being finalised, and further details will be announced later this week.
This is expected to include China and India, as part of high-level agreements between the countries and South Africa that was announced in July during the BRICS summit.
While the details of the Chinese visa agreement is not confirmed, Hanekom did mention that one of the options being considered was a “multiple entry Visa” that would be valid for five years and offer tourists up to 90 days in the country.
South Africa is also rolling out e-visas soon, set to be a gradual roll-out starting with "Phase 1, Release 1, for applications for temporary residence visas, adjudication of temporary residence visas, applications for waivers, notifications to the applicant via email and biometrics captured at the Mission."
The ePermit will be piloted at one Mission or local office in the last quarter of the next financial year by 31 March 2019. This is to ensure system stability. Once stable, more offices locally and abroad can then be gradually brought online, says the DHA
This is sure to make travel to South Africa much simpler and less complicated once it is up and running.