1 00:00:00,000 --> 00:00:11,240 Hello and welcome to the So What podcast in which political economic analyst JP Landman 2 00:00:11,240 --> 00:00:16,400 discusses the issues uppermost in the minds of South Africans. You can find a written 3 00:00:16,400 --> 00:00:27,600 version of this content on JP's website jplantman.co.za. I am Ruda Landman and I am your host. 4 00:00:27,600 --> 00:00:34,960 In this conversation, a company's JP's newsletter dated the 18th of October 2024, titled Some 5 00:00:34,960 --> 00:00:39,000 You Win, Some You Lose. It has been a busy two weeks. 6 00:00:39,000 --> 00:00:43,360 Yes, indeed it has been. You know the old saying that there are weeks where nothing 7 00:00:43,360 --> 00:00:47,400 happens and then there are days when weeks happen. And certainly in the first two weeks 8 00:00:47,400 --> 00:00:52,720 of October, a lot of things have happened, both in the policy space and in the political 9 00:00:52,720 --> 00:00:53,720 space. 10 00:00:53,720 --> 00:00:55,200 Let's begin with policy. 11 00:00:55,200 --> 00:01:00,840 Well, first of all, we got a new visa regime and it's a new visa regime that has long been 12 00:01:00,840 --> 00:01:05,240 in the making, but at last it has now been gazetted in the government gazette. So this 13 00:01:05,240 --> 00:01:09,760 is now the law of the land, so to speak, and it provides for two things. It provides for 14 00:01:09,760 --> 00:01:15,120 a point based system when you apply for a South African visa. So that takes care of 15 00:01:15,120 --> 00:01:20,280 a lot of the subjectivity and discretion because there are points for this, points for that 16 00:01:20,280 --> 00:01:26,600 and that is clear and unambiguous. And secondly, it provides for a remote work visa so people 17 00:01:26,600 --> 00:01:32,880 can come to South Africa and live here, but work elsewhere. And of course, that is also 18 00:01:32,880 --> 00:01:37,800 enormously beneficial. We offer it, we have a lot to offer in terms of facilities and 19 00:01:37,800 --> 00:01:42,720 climate and personal services and so on. So for people to work elsewhere, but come and 20 00:01:42,720 --> 00:01:48,920 live here, spend the money here, buy goods and services here is clearly a big plus. So 21 00:01:48,920 --> 00:01:54,560 those two changes give us a much easier and much more modern visa regime. 22 00:01:54,560 --> 00:02:01,360 And that was only the latest in the project Wollend-Lehler's priority list. 23 00:02:01,360 --> 00:02:08,760 Yes, indeed. Project Wollend-Lehler had as its priorities water, electricity, water licenses 24 00:02:08,760 --> 00:02:14,480 really, electricity and a few other items and visas were one of them. Visas can now 25 00:02:14,480 --> 00:02:20,400 be ticked. The other items that can be ticked is spectrum release that was done and achieved 26 00:02:20,400 --> 00:02:26,400 and has unleashed a lot of investment. The electricity regulation reform that was done, 27 00:02:26,400 --> 00:02:32,520 Mr. Ramaphosa signed the bill, facilitating private sector investment into renewables. 28 00:02:32,520 --> 00:02:38,720 So far about 500 billion rand has been unlocked and counting that number keeps on going up. 29 00:02:38,720 --> 00:02:44,920 So that was done. Breaking up ESCOM, transmission has been separated out of ESCOM, distribution 30 00:02:44,920 --> 00:02:51,720 still remains to be done. Ensuring electricity supply, we are now over 200 days of no load 31 00:02:51,720 --> 00:02:58,520 shedding and again counting. It seems as if it's holding and water licenses had to be 32 00:02:58,520 --> 00:03:03,760 fixed and that was done. The bigger problems of water of which we in Gauteng are very well 33 00:03:03,760 --> 00:03:10,000 aware of that will be tackled in Wollend-Lehler 2. Wollend-Lehler 2 has not been announced 34 00:03:10,000 --> 00:03:14,480 yet but it will probably be coming out in the next couple of weeks and it will cover 35 00:03:14,480 --> 00:03:20,640 water security as opposed to water licenses, water security, logistics, more electricity 36 00:03:20,640 --> 00:03:29,040 reform, local government, spatial inequality and digital transformation. Now water, spatial 37 00:03:29,040 --> 00:03:35,440 inequality and local government, those are big and important issues. They are tough nuts 38 00:03:35,440 --> 00:03:42,040 to crack and it will be interesting to see how Wollend-Lehler 2 deals with that. 39 00:03:42,040 --> 00:03:49,520 Since you start with, you captioned this, some you win, some you lose, Transnet's loss 40 00:03:49,520 --> 00:03:55,720 in the court last week was also was a setback. Yes, it was a setback for project Wollend-Lehler. 41 00:03:55,720 --> 00:04:01,520 The port reform is part of logistics reform and what happened there was Transnet has under 42 00:04:01,520 --> 00:04:07,600 government pressure, government guidance, policy guidance, issued a 25-year concession 43 00:04:07,600 --> 00:04:13,160 to an international Philippine company to come and run the Durban port but also to invest 44 00:04:13,160 --> 00:04:19,640 11 billion rand to modernize the new equipment and so on. That went out on tender. There 45 00:04:19,640 --> 00:04:27,120 were about I think 22 people or 22 entities interested in the license. It was then awarded 46 00:04:27,120 --> 00:04:32,880 to the Philippine company. One other international logistics company, Maersk, who is quite well 47 00:04:32,880 --> 00:04:38,360 known in South Africa, one sees the name all over, objected and said Transnet did not apply 48 00:04:38,360 --> 00:04:44,580 the tender conditions correctly and they went to the high court to interdict the concessioning. 49 00:04:44,580 --> 00:04:51,280 The judge agreed with Maersk and Transnet was interdicted. Temporarily, there will now 50 00:04:51,280 --> 00:04:56,240 be a second phase where the case will be heard on the merits and we will then see what the 51 00:04:56,240 --> 00:05:02,760 judge decides. I hope the courts do not take a final decision on this because I don't think 52 00:05:02,760 --> 00:05:06,960 that's the way these things should be handled. You may remember that we've had a similar 53 00:05:06,960 --> 00:05:14,400 situation of spectrum release. When everything was set and gun ready to go, three companies 54 00:05:14,400 --> 00:05:20,400 three big ICT companies brought applications against spectrum release, claiming that it 55 00:05:20,400 --> 00:05:25,080 was prejudicing their particular business model. That issue in the end was resolved 56 00:05:25,080 --> 00:05:30,760 outside the courtroom. Executive decisions were taken, compromises were made and spectrum 57 00:05:30,760 --> 00:05:36,000 release was not only done but was done and dusted. So I'm looking to that example to 58 00:05:36,000 --> 00:05:42,800 be pursued in the case of this port concessioning. That's the way to resolve it, not via the 59 00:05:42,800 --> 00:05:48,360 courts. What's happening in the relationship between government and business? Well, they're 60 00:05:48,360 --> 00:05:53,640 quite interesting. The first phase of government business cooperation, which goes back about 61 00:05:53,640 --> 00:05:59,920 a year or so, has now been concluded with projects finalized and now on the 1st of October 62 00:05:59,920 --> 00:06:05,320 they signed what one can call a phase two agreement where they will carry on working 63 00:06:05,320 --> 00:06:14,640 together and they specialize in three areas particularly. The three areas are energy, 64 00:06:14,640 --> 00:06:21,760 ongoing energy reform, transport and logistics and crime and corruption. Since then, since 65 00:06:21,760 --> 00:06:26,120 the 1st of October, it has become clear that there's a fourth item that has been added 66 00:06:26,120 --> 00:06:31,840 to the list and that is water, particularly in Gauteng. So big companies have stepped 67 00:06:31,840 --> 00:06:36,120 forward and say they would like to play a role or they're capable of playing a role 68 00:06:36,120 --> 00:06:41,480 in resolving the water crisis. So those are the four areas on which business and government 69 00:06:41,480 --> 00:06:47,960 are cooperating and you will notice that it dovetails Willem Lela 1 and 2 almost perfectly. 70 00:06:47,960 --> 00:06:53,560 So the business government cooperation fits into making these reforms of Willem Lela 71 00:06:53,560 --> 00:06:59,320 1 and 2 work. That's really where they fit in. How can business help when it comes to 72 00:06:59,320 --> 00:07:05,320 water because water is becoming an enormous problem? Indeed, absolutely, particularly 73 00:07:05,320 --> 00:07:11,400 in Gauteng. There are two ways. The first way is by way of seconding people and getting 74 00:07:11,400 --> 00:07:17,200 management expertise into the various water bodies, helping with planning and execution. 75 00:07:17,200 --> 00:07:24,600 But secondly, and in a sense more important, investment. Water is underinvested in South 76 00:07:24,600 --> 00:07:30,480 Africa. I'm not just referring to the big capital projects. The private sector is already 77 00:07:30,480 --> 00:07:35,960 involved but we're talking about distribution at local government level. In Johannesburg 78 00:07:35,960 --> 00:07:39,560 something- So pipes next to the road. 79 00:07:39,560 --> 00:07:44,480 That kind of thing. I mean the water infrastructure in Johannesburg, in Gauteng in general, is 80 00:07:44,480 --> 00:07:50,220 old and it has to be replaced and that is quite a member of task. You've got to figure 81 00:07:50,220 --> 00:07:56,700 out new ways of doing that on the construction side but also on the financing side. And that's 82 00:07:56,700 --> 00:08:00,100 where business could play a role. 83 00:08:00,100 --> 00:08:06,720 And to jump to a completely different thing, how do you see our international relationships 84 00:08:06,720 --> 00:08:10,560 at the moment? Is it possible really to be non-aligned? 85 00:08:10,560 --> 00:08:16,560 Yeah, absolutely. There are a number of very successful countries that are very successfully 86 00:08:16,560 --> 00:08:22,080 non-aligned. Think of India. They are probably the prime example. Brazil. Brazil is a very 87 00:08:22,080 --> 00:08:28,280 good example. They're close to the US. US is a big market but they retain a separate 88 00:08:28,280 --> 00:08:34,240 identity. India, as I've already said, is a past master in that. So yes, it is possible. 89 00:08:34,240 --> 00:08:41,320 What we saw in October is that President Ramaphosa went to China to attend the Africa-China Cooperation 90 00:08:41,320 --> 00:08:49,560 Summit but he was received by Xi Jinping on a state visit, which is quite an honour or 91 00:08:49,560 --> 00:08:54,160 a compliment. And it's quite clear that the Chinese are very keen on closer relations 92 00:08:54,160 --> 00:09:01,120 with South Africa. At the same time, last week, the United States Embassy in South Africa 93 00:09:01,120 --> 00:09:07,440 released a statement to say that they will have a bosporat with the South African government 94 00:09:07,440 --> 00:09:13,800 on future relations and they wanted to develop quote unquote a strategic relationship with 95 00:09:13,800 --> 00:09:20,360 South Africa. Now, if you take this US embassy statement and you compare it to the US embassy 96 00:09:20,360 --> 00:09:25,880 allegations around Lady R, all unsubstantiated allegations I must say. 97 00:09:25,880 --> 00:09:31,180 Was that only last December? That was very recent, yeah. Then you can see 98 00:09:31,180 --> 00:09:34,960 how far things have moved. So I think it's quite clear that the Americans would like 99 00:09:34,960 --> 00:09:40,080 to have a better relationship. We're having a good relationship with China. So let's see 100 00:09:40,080 --> 00:09:46,000 where this goes. But I think the fact that the US embassy is participating in this process 101 00:09:46,000 --> 00:09:52,960 and want to create a strategic relationship answers your question that yes, it is possible 102 00:09:52,960 --> 00:10:00,760 to be non-aligned. But you have to be very clever and you must box very cleverly. 103 00:10:00,760 --> 00:10:07,680 We might refer our listeners to a Netflix series we watched last night. It's called 104 00:10:07,680 --> 00:10:14,120 History 101. It's not new. It's been there for a while. But last night we watched a chapter 105 00:10:14,120 --> 00:10:20,880 called The Rise of China. It's 21 minutes and it's fascinating. It's a condensed overview, 106 00:10:20,880 --> 00:10:25,080 very worth watching. Oh yes, absolutely. We misunderstand China 107 00:10:25,080 --> 00:10:30,360 a lot. I think China also misunderstands the West a lot. But it is a reality. You can't 108 00:10:30,360 --> 00:10:35,320 ignore it. And yes, the listeners would benefit from watching it. 109 00:10:35,320 --> 00:10:41,040 Coming back to Home Ground, once again we have to talk about Gauteng. China was a disaster, 110 00:10:41,040 --> 00:10:49,040 is a disaster, as far as Johannesburg can see. What does it mean locally and nationally? 111 00:10:49,040 --> 00:10:54,940 Gauteng has always been a bit of an outlier in the sense that there are or were two centers 112 00:10:54,940 --> 00:11:01,240 of powers in ANC that would have preferred to make a coalition, not with the DA and the 113 00:11:01,240 --> 00:11:06,160 other parties that we currently have in the coalition, but with the EFF and nowadays with 114 00:11:06,160 --> 00:11:12,560 MK. This goes back quite a while. What happened in the election in May was that the ANC and 115 00:11:12,560 --> 00:11:18,600 KwaZuna Natal got thrashed. So they were taken out as a serious player. They only got 17% 116 00:11:18,600 --> 00:11:23,440 of the vote. And well, you know, in politics if you don't have votes, you have nothing. 117 00:11:23,440 --> 00:11:28,160 In Gauteng, the ANC did a bit better here. They got 35% of the vote, still a minority 118 00:11:28,160 --> 00:11:33,640 government, but they do control the province and they're using that power base to shun 119 00:11:33,640 --> 00:11:41,000 the DA and to shun other moderate parties in the current government of national unity. 120 00:11:41,000 --> 00:11:47,200 They would prefer to go with the EFF and also MK. So there's clearly, that's where Gauteng 121 00:11:47,200 --> 00:11:52,000 is an outlier. Has been the case for a while and that is simply playing out in Swanee. 122 00:11:52,000 --> 00:11:59,000 And I think what we see in Swanee is the ANC, Panja Zalasufi, the ANC leader in Gauteng, 123 00:11:59,000 --> 00:12:06,120 is very proud that the ANC has reconquered, so to speak, metros in Gauteng, Johannesburg 124 00:12:06,120 --> 00:12:11,680 Metro, Toronto Metro, that used to be governed by different coalitions and are now governed 125 00:12:11,680 --> 00:12:17,840 by an ANC coalition. It's a political aim and they've succeeded in doing that. 126 00:12:17,840 --> 00:12:22,960 Whether that will pay off? Well, that we will have to see. What happened in Swanee is in 127 00:12:22,960 --> 00:12:29,840 a sense, unfortunate. Action SA withdrew from the ruling coalition, the one that they had 128 00:12:29,840 --> 00:12:36,160 with the DA and other small parties, and then went into coalition with the ANC. Now they 129 00:12:36,160 --> 00:12:43,200 haven't really explained that. They said Michael Beaumont, their national spokesman or national 130 00:12:43,200 --> 00:12:51,600 leader, not national leader, but an important leader, said the election in May created a 131 00:12:51,600 --> 00:12:57,920 new reality and they had to adjust to this new reality of coalitions. Now that's fine, 132 00:12:57,920 --> 00:13:03,320 but why then swap one coalition for another? They claim that it's because the DA coalition 133 00:13:03,320 --> 00:13:10,080 was not willing to spend money on the black townships. I think, well, the DA of course 134 00:13:10,080 --> 00:13:15,840 denies that, but I think more important, they haven't tabled this issue in the coalition 135 00:13:15,840 --> 00:13:21,240 and I think it's just an excuse that they're using afterwards. So Action SA has really 136 00:13:21,240 --> 00:13:26,760 pulled the plug there. That has now resulted in the mayor being removed. It has resulted 137 00:13:26,760 --> 00:13:33,520 in ANC led coalition. And then a further unfortunate thing happens, which shows you that we're 138 00:13:33,520 --> 00:13:40,880 not yet used to coalition politics in South Africa. Alan Zille then said, well, if Suleyya 139 00:13:40,880 --> 00:13:46,080 Brin cannot be a mayor in Twane, then the DA is not going to have any further talks 140 00:13:46,080 --> 00:13:53,920 with ANC about Ekorileini, Johannesburg and now Sommandela Bay. Now that's very unfortunate 141 00:13:53,920 --> 00:14:00,200 because Panjaza Lusufi scored a victory in Twane. By now walking away from Ekorileini, 142 00:14:00,200 --> 00:14:06,380 you in a sense solidify his victory. Why do I say that? Well, the ANC mayor of Ekorileini 143 00:14:06,380 --> 00:14:13,240 is on record that he would prefer to have the DA in his mayoral committee, not exclusively, 144 00:14:13,240 --> 00:14:19,600 but he wants them in his committee, in his mayoral management team. Why? In his words, 145 00:14:19,600 --> 00:14:24,840 we only have two years to go before the elections. It's not time for new ideas or talking. It's 146 00:14:24,840 --> 00:14:30,360 not time for service delivery. And he thought the DA could help with that or having the 147 00:14:30,360 --> 00:14:36,280 DA in his mayoral committee will help with that. That door has now been shut when the 148 00:14:36,280 --> 00:14:41,840 DA said they're not going to talk about further talks. The people in Nelsomandela Bay will 149 00:14:41,840 --> 00:14:48,280 know that the situation there has been precarious for a long time, leading to instability. And 150 00:14:48,280 --> 00:14:55,640 likewise, this statement now has closed that door. So, you know, I think we have a situation 151 00:14:55,640 --> 00:15:02,660 there where some people philosophically do not want to deal with the DA or do not want 152 00:15:02,660 --> 00:15:08,680 to promote the idea of the government of national unity at local level. But other people- 153 00:15:08,680 --> 00:15:10,320 Some people in the ANC. 154 00:15:10,320 --> 00:15:15,400 Yeah. But other people through their style. It's also jeopardizing the government of national 155 00:15:15,400 --> 00:15:21,440 unity or the idea of national unity at local level. So that's where we are. We'll have 156 00:15:21,440 --> 00:15:24,760 to see how this plays out over the next two years. 157 00:15:24,760 --> 00:15:25,760 So what? 158 00:15:25,760 --> 00:15:30,460 Well, I think the so what is that I do not for one moment think that the shenanigans 159 00:15:30,460 --> 00:15:37,680 in Kharteng and Chuanhe and so on, that they are going to affect the government of national 160 00:15:37,680 --> 00:15:42,120 unity. I think the government of national unity will carry on with their program, which 161 00:15:42,120 --> 00:15:50,320 is clearly summarized in the Volandela program of action. That structural reform will play 162 00:15:50,320 --> 00:15:57,560 out. And when that structural reform has taken its course, it will certainly lift the economic 163 00:15:57,560 --> 00:16:03,680 growth in the country. We've got research from the Barofa Economic Research in Sanabas 164 00:16:03,680 --> 00:16:08,500 telling us, showing us that it's quite possible to achieve a growth rate of three to three 165 00:16:08,500 --> 00:16:14,200 and a half percent versus the one maximum one and a half percent we currently have. 166 00:16:14,200 --> 00:16:20,160 Now if we move from a one and a half percent economy to a three and a half percent economy, 167 00:16:20,160 --> 00:16:25,280 that's really a game changer. And that can come out of the Volandela reforms. And that 168 00:16:25,280 --> 00:16:28,320 is firmly in place. 169 00:16:28,320 --> 00:16:33,680 That actually summarizes all the separate points you make in your so what paragraph. 170 00:16:33,680 --> 00:16:40,320 The formation of national unity is a win. Kharteng is unlikely to upset or derail that. 171 00:16:40,320 --> 00:16:45,360 Big win that the process of structural reform at national level is proceeding apace and 172 00:16:45,360 --> 00:16:53,240 it opens the possibility of a return to three percent plus growth over the next few years. 173 00:16:53,240 --> 00:16:58,380 Thank you for listening to the So What podcast. If you enjoy this content, please don't forget 174 00:16:58,380 --> 00:17:03,300 to leave a review and a rating and please consider subscribing so you don't miss any 175 00:17:03,300 --> 00:17:09,400 future episodes. Also tell your friends. Remember you can find a written version of all JP's 176 00:17:09,400 --> 00:17:37,000 content at jplandman.co.za.