loyola llothta
☭☭☭
You have the videoI think it was on the Arise Show (Nigerian) that they were talking about palm oil as well. I didn't realize it was such a large commodity.
Essential The Africa the Media Doesn't Tell You About
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Unfortunately, no. I was Youtube surfing. It was mentioned as a minor topic.
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At the bolded part - Palm Oil is such a huge commodity that it's one of the causes for the deforestation of Borneo.I think it was on the Arise Show (Nigerian) that they were talking about palm oil as well. I didn't realize it was such a large commodity.
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The axe murderer
For I am death and I ride on a pale horse
Not sure if posted but
Measles kills 6,000 in Democratic Republic of Congo, the world's worst outbreak - CNN
Measles kills 6,000 in Democratic Republic of Congo, the world's worst outbreak - CNN
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DAVOS/WEF talk on Strategic Outlook on Africa
SA needs an alternative to privatisation
Having lived through Zuma’s kleptomania and still contending with the EFF’s kleptocracy, some South Africans have shifted in favour of neoliberalism. But is this the solution?
By: Tricontinental | 13 Jan 2020
25 April 2018: Saftu members protest the proposed minimum wage.
According to a 2018 World Bank report, South Africa is the most unequal country in the world, with a Gini coefficient of 0.63. Intergenerational mobility is low, which means that inequalities are passed down from generation to generation. Even as the elite and the middle class in South Africa are no longer overwhelmingly white, impoverishment remains a black phenomenon.
In 2020 South Africa faces low growth and low job creation prospects; the increasing labour force is projected to exacerbate unemployment pressures, poverty and inequality. This will be the sixth consecutive year where economic growth will be below population growth.
The crisis of systemic, structural unemployment – which hits youth particularly hard – and sustained low economic growth is generally acknowledged as serious. Many commentators argue that it is not politically sustainable and point to xenophobic violence and the rise of authoritarian populism – both within the ruling ANC and in the form of the EFF – as harbingers of further dangers to come. The language of crisis is being used across the political spectrum.
The dominant voices in the elite public sphere are pushing hard for a standard set of neoliberal measures including austerity, privatisation and union bashing. A set of proposals along these lines from the finance minister has been enthusiastically endorsed by big business, right-wing think tanks, most public commentators and the International Monetary Fund (IMF).
Corruption
The public discussion, and much public sentiment, are fundamentally shaped by widespread opposition to the kleptocratic politics that developed under the administration of Jacob Zuma (2009-2018). This form of kleptocratic politics, which seeks to legitimate itself in the name of radical nationalism, and makes effective use of “fake news”, continues to be strongly endorsed by a powerful faction in the ruling party and the EFF.
The severe mismanagement of state-owned entities under Zuma resulted in the squandering of an estimated R1 trillion from state coffers. This massive corruption and the wholesale maladministration of public funds have severely undermined the state’s credibility among much of the citizenry, making arguments for privatisation attractive to many.
Under the administration of Thabo Mbeki (1999-2008), the government was moving swiftly to use the state and parastatal organisations to uplift the lives of the black majority. However, kleptocracy has severely hampered the government’s ability to drive societal change and be an engine of economic growth. The collapse in the government’s credibility is so severe that even some trade unions now support privatisation.
At the same time, support for Zuma among some prominent trade unionists and the collapse of some unions into serious corruption – and even gangsterism – have generally weakened the standing of unions in society. This has enabled a frenzy of union bashing from the right. Unions are presented, and misrepresented, as allies of the kleptocracy or – in the words of one prominent commentator – as “spoilt brats” undermining the “national interest” with opposition to retrenchments and demands for inflation-related annual increases. Former British prime minister Margaret Thatcher’s notorious phrase, “the enemy within”, has been used by a number of public figures to refer to unions.
Austerity
South Africa lives with the existential threat of a ratings downgrade. Whenever ratings agencies are preparing to announce their numbers, there is massive hysteria in the media about their announcement and the impact that it will have on the country. This is utilised as a pressure point for the government to introduce austerity. The public is constantly told that if austerity is not implemented, there will be a ratings downgrade, followed by a disaster.
There has also been manic media coverage about the debt-to-GDP (gross domestic product) ratio and the public-sector wage bill. According to the IMF, the estimated world average debt-to-GDP ratio for 2020 is 82.9%. The averages for advanced and emerging economies are 103.7% and 55.1%, respectively. South Africa’s debt-to-GDP ratio (60.8%) is lower than that of other major emerging markets such as Brazil (92.4%), Argentina (69%), India (67.8%), Egypt (84.6%) and Pakistan (79.1%). South Africa has a GDP growth problem – not a debt problem.
Over the past three years, the government has cut spending by R200 billon; in the medium-term budget in October 2019 the treasury said that it has identified cuts of R49 billion over the next two years. It wants additional austerity measures of more than R150 billion but has not yet decided where to cut.
Austerity reduces GDP growth; the lower GDP growth rate reduces government revenue and results in a higher budget deficit and a higher level of debt. This results in an increase in the debt-to-GDP ratio.
The media has pushed a narrative that points to the public-sector wage bill as the number one option for further cuts. According to the budget statement, average remuneration in the public sector has risen by an annual average of 8% since 2010-2011, which was not much higher than the increase of 7.2% in the rest of the economy. The number of public servants as a percentage of the population and total employment is low by international standards.
The Left project
Given the malfeasance that has been foisted upon South Africa’s state organs in the recent past, it is now easy for right-wing forces to conflate anti-corruption and austerity. Consequently, the right-wing economic discourse has been normalised in the country as being the only way to fix South Africa’s economic problems. The maladministration within the state over the past decade has led to an increased call in the public sphere for the privatisation of state-owned enterprises.
The dominant forces using Left language in the public sphere are the kleptomaniac Zuma faction of the ANC and the populist (and also kleptocratic) race-based EFF. Unsurprisingly, owing to this usurpation of leftist language by predatory and authoritarian formations, the language of the Left has been significantly discredited and is often seen as little more than a cover for kleptocratic politics.
Under these circumstances it is vital that a Left project restore its credibility through alternative proposals to austerity, privatisation and union bashing; what is needed is a discourse and policy framework that clearly opposes both the kleptocratic politics of the Zuma faction of the ANC as well as the EFF and the neoliberal politics that are presented as the only viable alternative to kleptocracy.
The lack of an organised progressive intellectual project is one of the reasons that right-wing economic thought has managed to take root. Where there are progressive economists and policy experts, they are generally not linked to material political forces. As a result, very little in the way of an alternative to neoliberalism is being presented in the country.
Linkages need to be made between the experience of South Africa and the experiences of other countries where austerity measures have been used and the effect that these measures have had on the stability and security of the state.
This is an excerpt from the Tricontinental dossier: The Word Oscillates Between Crises and Protests.
SA needs an alternative to privatisation
Having lived through Zuma’s kleptomania and still contending with the EFF’s kleptocracy, some South Africans have shifted in favour of neoliberalism. But is this the solution?
By: Tricontinental | 13 Jan 2020
25 April 2018: Saftu members protest the proposed minimum wage.
According to a 2018 World Bank report, South Africa is the most unequal country in the world, with a Gini coefficient of 0.63. Intergenerational mobility is low, which means that inequalities are passed down from generation to generation. Even as the elite and the middle class in South Africa are no longer overwhelmingly white, impoverishment remains a black phenomenon.
In 2020 South Africa faces low growth and low job creation prospects; the increasing labour force is projected to exacerbate unemployment pressures, poverty and inequality. This will be the sixth consecutive year where economic growth will be below population growth.
The crisis of systemic, structural unemployment – which hits youth particularly hard – and sustained low economic growth is generally acknowledged as serious. Many commentators argue that it is not politically sustainable and point to xenophobic violence and the rise of authoritarian populism – both within the ruling ANC and in the form of the EFF – as harbingers of further dangers to come. The language of crisis is being used across the political spectrum.
The dominant voices in the elite public sphere are pushing hard for a standard set of neoliberal measures including austerity, privatisation and union bashing. A set of proposals along these lines from the finance minister has been enthusiastically endorsed by big business, right-wing think tanks, most public commentators and the International Monetary Fund (IMF).
Corruption
The public discussion, and much public sentiment, are fundamentally shaped by widespread opposition to the kleptocratic politics that developed under the administration of Jacob Zuma (2009-2018). This form of kleptocratic politics, which seeks to legitimate itself in the name of radical nationalism, and makes effective use of “fake news”, continues to be strongly endorsed by a powerful faction in the ruling party and the EFF.
The severe mismanagement of state-owned entities under Zuma resulted in the squandering of an estimated R1 trillion from state coffers. This massive corruption and the wholesale maladministration of public funds have severely undermined the state’s credibility among much of the citizenry, making arguments for privatisation attractive to many.
Under the administration of Thabo Mbeki (1999-2008), the government was moving swiftly to use the state and parastatal organisations to uplift the lives of the black majority. However, kleptocracy has severely hampered the government’s ability to drive societal change and be an engine of economic growth. The collapse in the government’s credibility is so severe that even some trade unions now support privatisation.
At the same time, support for Zuma among some prominent trade unionists and the collapse of some unions into serious corruption – and even gangsterism – have generally weakened the standing of unions in society. This has enabled a frenzy of union bashing from the right. Unions are presented, and misrepresented, as allies of the kleptocracy or – in the words of one prominent commentator – as “spoilt brats” undermining the “national interest” with opposition to retrenchments and demands for inflation-related annual increases. Former British prime minister Margaret Thatcher’s notorious phrase, “the enemy within”, has been used by a number of public figures to refer to unions.
Austerity
South Africa lives with the existential threat of a ratings downgrade. Whenever ratings agencies are preparing to announce their numbers, there is massive hysteria in the media about their announcement and the impact that it will have on the country. This is utilised as a pressure point for the government to introduce austerity. The public is constantly told that if austerity is not implemented, there will be a ratings downgrade, followed by a disaster.
There has also been manic media coverage about the debt-to-GDP (gross domestic product) ratio and the public-sector wage bill. According to the IMF, the estimated world average debt-to-GDP ratio for 2020 is 82.9%. The averages for advanced and emerging economies are 103.7% and 55.1%, respectively. South Africa’s debt-to-GDP ratio (60.8%) is lower than that of other major emerging markets such as Brazil (92.4%), Argentina (69%), India (67.8%), Egypt (84.6%) and Pakistan (79.1%). South Africa has a GDP growth problem – not a debt problem.
Over the past three years, the government has cut spending by R200 billon; in the medium-term budget in October 2019 the treasury said that it has identified cuts of R49 billion over the next two years. It wants additional austerity measures of more than R150 billion but has not yet decided where to cut.
Austerity reduces GDP growth; the lower GDP growth rate reduces government revenue and results in a higher budget deficit and a higher level of debt. This results in an increase in the debt-to-GDP ratio.
The media has pushed a narrative that points to the public-sector wage bill as the number one option for further cuts. According to the budget statement, average remuneration in the public sector has risen by an annual average of 8% since 2010-2011, which was not much higher than the increase of 7.2% in the rest of the economy. The number of public servants as a percentage of the population and total employment is low by international standards.
The Left project
Given the malfeasance that has been foisted upon South Africa’s state organs in the recent past, it is now easy for right-wing forces to conflate anti-corruption and austerity. Consequently, the right-wing economic discourse has been normalised in the country as being the only way to fix South Africa’s economic problems. The maladministration within the state over the past decade has led to an increased call in the public sphere for the privatisation of state-owned enterprises.
The dominant forces using Left language in the public sphere are the kleptomaniac Zuma faction of the ANC and the populist (and also kleptocratic) race-based EFF. Unsurprisingly, owing to this usurpation of leftist language by predatory and authoritarian formations, the language of the Left has been significantly discredited and is often seen as little more than a cover for kleptocratic politics.
Under these circumstances it is vital that a Left project restore its credibility through alternative proposals to austerity, privatisation and union bashing; what is needed is a discourse and policy framework that clearly opposes both the kleptocratic politics of the Zuma faction of the ANC as well as the EFF and the neoliberal politics that are presented as the only viable alternative to kleptocracy.
The lack of an organised progressive intellectual project is one of the reasons that right-wing economic thought has managed to take root. Where there are progressive economists and policy experts, they are generally not linked to material political forces. As a result, very little in the way of an alternative to neoliberalism is being presented in the country.
Linkages need to be made between the experience of South Africa and the experiences of other countries where austerity measures have been used and the effect that these measures have had on the stability and security of the state.
This is an excerpt from the Tricontinental dossier: The Word Oscillates Between Crises and Protests.
SA needs an alternative to privatisation
The crisis of South Africa’s energy company and unions’ plan to save it
Union’s solution to the crisis in Eskom is a reversal of the government’s policy of decommissioning Eskom’s power production units and outsourcing the energy requirement to private companies
January 16, 2020 by Pavan Kulkarni
NUMSA and NUM held a picket outside Eskom's Megawatt Park in Johannesburg on January 15. (Photo: Chanel Retief)
As the crisis at Eskom continues to deepen, the National Union of Metalworkers of South Africa (NUMSA) and the National Union of Mineworkers (NUM) are preparing for a national strike in the first quarter of this year, to defend the South Africa’s state owned energy producer from unbundling and privatization.
The dates for the strike action is yet to be finalized, following which a notice will be served and an official call given, NUMSA’s national spokesperson, Phakamile Hlubi Majola, told Peoples Dispatch.
Yesterday, the two unions jointly organized a picket at the company’s Megawatt Park in Johannesburg on January 15. In a memorandum of demands submitted to the management, the unions called for an immediate end to the unbundling of Eskom, which has been touted by the government as a “rescue plan”.
“The unbundling of Eskom will not solve [its] problems” said NUMSA’s national spokesperson Phakamile Hlubi Majola. “Eskom’s problem, as we all know, are related to the fact that it is hugely in debt, it is technically insolvent, and by breaking it up into three parts, you are not solving that problem.”
Reeling under this financial stress, Eskom has undertaken historically unprecedented levels of load-shedding over the last year, which has taken a severe toll on the country’s overall economy.
Eskom’s crisis has affected South Africa’s overall economy
Load-shedding has been widely regarded as one of the main factors behind the fact that South Africa’s economy in 2019 grew at a mere 0.7%, as opposed to the predicted 1.7%. The country’s credit rating has been sharply downgraded by international agencies.
Widespread job losses due to energy crisis, especially in the manufacturing and mining sector, has hugely contributed to the unemployment level, which rose last year from 27.6% – a record high since the 2008 global financial crisis – to almost 30%.
Amid this crisis, on January 10, Jabu Mabuza resigned from the post of the CEO of Eskom. According to a statement from the office of the country’s President Cyril Ramaphosa, “Jabu Mabuza apologised for Eskom’s inability to meet the commitment it made to the President and Deputy President at a meeting on 11 December 2019” that plans were in place to ensure there will be no load shedding till January 13, 2020.
Two days prior to the meeting, on December 9, Eskom implemented a historically unprecedented stage 6 load shedding, where 6000 megawatts of energy had to be shed from the national grid to prevent its failure.
After the meeting, President Ramaphosa had assured the public that there will not be any load-shedding between December 17 and January 13. However, the breakdown of generators continued, and with it the load-shedding.
On January 14, media reports claimed that Eskom had asked the municipalities to prepare for Stage 8 load-shedding. Calling these reports “erroneous and incorrect”, Eskom published a press statement which stated that “Stage 8 equates to approximately an 8000 MW deficit. The likelihood of reaching Stage 8 is low.”
Stepping in for President’s defense amidst this crisis, the Deputy President of the country and of the ruling ANC, David Mabuza, claimed that Ramaphosa was “misled” about the extent of the problem with Eskom’s generators by CEO Jabu Mabauza and Public Enterprises Minister, Pravin Gordhan.
While welcoming Mabauza’s resignation, NUMSA, in a statement on January 12 by its national spokesperson, Phakamile Hlubi Majola, said: “we do not buy his cheap tactic of simply taking the fall for misleading the President. Our honest view is that the entire incompetent Eskom board must go including the COO, Jan Oberholser who has added absolutely no value except adding to the wage bill.”
This board, NUMSA has demanded, should be replaced with another one, at least 70% of which are comprised of engineers, the most competent of whom, the union alleges, have been marginalized or forced to quit by the current board. The board must also include representatives from unions, along with those from civil society and the business sector.
In its statement NUMSA has also demanded the sacking of Public Enterprises Minister Gordhan, and calls on the President “to take decisive action and a decision to appoint a new Minister of Public Enterprises in the best interest of the country for all the other SOEs.”
The “rescue plan” Gordhan had presented and President Ramaphosa had approved, is in effect an acceleration of the very same policies which the unions claim have brought Eskom to ruin.
The crisis of Eskom
At the root of the Eskom crisis is the drain of its revenue into the coffers of privately owned Independent Power Producers (IPP) and into the coffers of private companies which have ratcheted up the prices after taking over the ownership of coal mines which were previously held by Eskom.
Global giants such as Glencore, South32, Anglo, Exxaro and Liketh took ownership of mines previously controlled by Eskom were handed over. As a result, Eskom relies on these companies to supply it with the coal required to produce electricity.
“It is these companies that have been driving high electricity tariffs because they charge exorbitant coal prices to Eskom,” NUMSA maintains. “Instead of moving decisively [against these companies] to…nationalize coal as our country’s strategic mineral,” Gordhan continued to make concessions for their profitability.
While having lost control over the supply of coal for power production on the one hand, Eskom has also been gradually losing control of the power generation itself. Since 2015, instead of investing capital into extending the lifespans of the electricity generation units which are now very old, the government has been decommissioning them and spending this money on paying private IPPs to supply to the grid. This is despite the fact that Eskom has the capacity to produce electricity at much lower costs that what is charged by the IPPs.
As a result, in 2015, out of the R8.2 billion (USD$570 million) generated from tariff increase, R6.5 billion (USD$451.9 million) went as payments to the private IPPs that have contracts with Eskom for power supply. The following year, when Eskom had “enough capacity to generate a unit of electricity at…[R0.42] (USD$0.029) per kilowatt hour,” more unnecessary contracts were signed with IPPs, which then sold power to Eskom at a much higher price, causing the SOE a loss of R9 billion (USD$625.9 million).
Again, in 2018, the then Energy Minister Jeff Radebe, on behalf of Eskom, signed another R56 billion (USD$3.89 billion) contract with 27 more IPPs, despite the strong opposition by the unions. That year alone, R21.3 billion (USD$1.48 billion) was spent on paying the IPPs, from which Eskom bought electricity at R2.22 (USD$0.15) per kilowatt and sold at R1.38 per kilowatt hour, costing the company a loss of R13 billion (USD$904).
In the meantime, the private IPPs are making profits at the cost of Eskom. This is not because the private companies are inherently better at adapting to the changes in supply and demand. On the contrary, the “must buy first principle,” on the basis of which government-guaranteed Power Purchasing Agreements have been signed with the IPPs, ensure that these “IPPs are guaranteed payment from Eskom whether or not there is a demand,” according to NUMSA.
According to the joint memorandum submitted by NUMSA, Eskom in the recent period has been buying power from IPPs at R4.04 ($0.28) per kilowatt and selling it to public at R0.83 ($0.058) per kilowatt, as a result of the nature of these contracts.
This government-imposed resource drain on the SOE has left Eskom with little capital to invest in extending the lifespan of its generators, which have exhibited signs of deterioration since 2015.
Unions have been demanding a reversal of these policies. Specifically, they are demanding the cancellation of the exorbitantly priced contracts handed over to the private IPPs. In its place, the power-production tasks should be insourced into Eskom, and money saved from cancellation should be invested into extending the lifespan of existing generators or acquiring new capacity.
Unions resist the government’s ploy for privatization
The government, on the other hand, is using the very fact that most of its generators are reaching the end of its lifespan to justify the decommissioning of more plants from the SOE and replacing them with more contracts to private IPPs.
The need to transition from coal to renewable energy is also being opportunistically used by the government to justify the policy of decommissioning publicly owned coal plants and outsourcing the energy requirement to privately owned Renewable Energy Independent Power Producers (REIPPs).
While both Gordhan and President Ramaphosa have time and again sought to reassure the public that the government is not seeking to privatize Eskom, NUMSA has called it “a lie”.
“In actual fact every power station that is being decommissioned is being replaced on the grid by REIPPs. REIPPs are owned by the private sector and therefore this constitutes nothing but privatization.
Hlubi Majola warns that “privatization of Eskom will mean that electricity will become even more expensive and inaccessible to members of the working class and the poor. Only a cheap [supply of] electricity, through a state-owned entity like Eskom, can.. ensure that we have a regular power supply and allow.. our economy to grow in the long-term.”
NUMSA, which has for long advocated a transition to clean energy, is not opposed to a transition to renewable sources. The transition, however, “must be at a pace and cost that the country can afford,” the union insists. “As things stand, with coal you can produce electricity at a rate of.. [R0.55] ($0.038) per kilowatt hour, but with REIPPs you will produce that same electricity at a whopping R2.35 ($0.16) per kilowatt hour.”
Instead of handing over the strategic power sector to overcharging private players under the cover of transitioning to renewable energy sources, NUMSA calls for a socially-owned renewable energy sector, created by setting up “Eskom Renewable Energy Company that will execute 70% of the” renewable energy projects set out in the Integrated Resource Plan (IRP) 2019. All the projects set out in this document are to be completed by 2030.
In order to back up their demands, the unions are mobilizing for a series of actions. The picket yesterday was “just one of a series of marches and demonstrations”, Hlubi Majola asserts. “There is even a possibility of a national strike which we are calling for, as NUMSA and NUM, in order to defend Eskom against unbundling and privatization.”
The crisis of South Africa’s energy company and unions’ plan to save it
Union’s solution to the crisis in Eskom is a reversal of the government’s policy of decommissioning Eskom’s power production units and outsourcing the energy requirement to private companies
January 16, 2020 by Pavan Kulkarni
NUMSA and NUM held a picket outside Eskom's Megawatt Park in Johannesburg on January 15. (Photo: Chanel Retief)
As the crisis at Eskom continues to deepen, the National Union of Metalworkers of South Africa (NUMSA) and the National Union of Mineworkers (NUM) are preparing for a national strike in the first quarter of this year, to defend the South Africa’s state owned energy producer from unbundling and privatization.
The dates for the strike action is yet to be finalized, following which a notice will be served and an official call given, NUMSA’s national spokesperson, Phakamile Hlubi Majola, told Peoples Dispatch.
Yesterday, the two unions jointly organized a picket at the company’s Megawatt Park in Johannesburg on January 15. In a memorandum of demands submitted to the management, the unions called for an immediate end to the unbundling of Eskom, which has been touted by the government as a “rescue plan”.
“The unbundling of Eskom will not solve [its] problems” said NUMSA’s national spokesperson Phakamile Hlubi Majola. “Eskom’s problem, as we all know, are related to the fact that it is hugely in debt, it is technically insolvent, and by breaking it up into three parts, you are not solving that problem.”
Reeling under this financial stress, Eskom has undertaken historically unprecedented levels of load-shedding over the last year, which has taken a severe toll on the country’s overall economy.
Eskom’s crisis has affected South Africa’s overall economy
Load-shedding has been widely regarded as one of the main factors behind the fact that South Africa’s economy in 2019 grew at a mere 0.7%, as opposed to the predicted 1.7%. The country’s credit rating has been sharply downgraded by international agencies.
Widespread job losses due to energy crisis, especially in the manufacturing and mining sector, has hugely contributed to the unemployment level, which rose last year from 27.6% – a record high since the 2008 global financial crisis – to almost 30%.
Amid this crisis, on January 10, Jabu Mabuza resigned from the post of the CEO of Eskom. According to a statement from the office of the country’s President Cyril Ramaphosa, “Jabu Mabuza apologised for Eskom’s inability to meet the commitment it made to the President and Deputy President at a meeting on 11 December 2019” that plans were in place to ensure there will be no load shedding till January 13, 2020.
Two days prior to the meeting, on December 9, Eskom implemented a historically unprecedented stage 6 load shedding, where 6000 megawatts of energy had to be shed from the national grid to prevent its failure.
After the meeting, President Ramaphosa had assured the public that there will not be any load-shedding between December 17 and January 13. However, the breakdown of generators continued, and with it the load-shedding.
On January 14, media reports claimed that Eskom had asked the municipalities to prepare for Stage 8 load-shedding. Calling these reports “erroneous and incorrect”, Eskom published a press statement which stated that “Stage 8 equates to approximately an 8000 MW deficit. The likelihood of reaching Stage 8 is low.”
Stepping in for President’s defense amidst this crisis, the Deputy President of the country and of the ruling ANC, David Mabuza, claimed that Ramaphosa was “misled” about the extent of the problem with Eskom’s generators by CEO Jabu Mabauza and Public Enterprises Minister, Pravin Gordhan.
While welcoming Mabauza’s resignation, NUMSA, in a statement on January 12 by its national spokesperson, Phakamile Hlubi Majola, said: “we do not buy his cheap tactic of simply taking the fall for misleading the President. Our honest view is that the entire incompetent Eskom board must go including the COO, Jan Oberholser who has added absolutely no value except adding to the wage bill.”
This board, NUMSA has demanded, should be replaced with another one, at least 70% of which are comprised of engineers, the most competent of whom, the union alleges, have been marginalized or forced to quit by the current board. The board must also include representatives from unions, along with those from civil society and the business sector.
In its statement NUMSA has also demanded the sacking of Public Enterprises Minister Gordhan, and calls on the President “to take decisive action and a decision to appoint a new Minister of Public Enterprises in the best interest of the country for all the other SOEs.”
The “rescue plan” Gordhan had presented and President Ramaphosa had approved, is in effect an acceleration of the very same policies which the unions claim have brought Eskom to ruin.
The crisis of Eskom
At the root of the Eskom crisis is the drain of its revenue into the coffers of privately owned Independent Power Producers (IPP) and into the coffers of private companies which have ratcheted up the prices after taking over the ownership of coal mines which were previously held by Eskom.
Global giants such as Glencore, South32, Anglo, Exxaro and Liketh took ownership of mines previously controlled by Eskom were handed over. As a result, Eskom relies on these companies to supply it with the coal required to produce electricity.
“It is these companies that have been driving high electricity tariffs because they charge exorbitant coal prices to Eskom,” NUMSA maintains. “Instead of moving decisively [against these companies] to…nationalize coal as our country’s strategic mineral,” Gordhan continued to make concessions for their profitability.
While having lost control over the supply of coal for power production on the one hand, Eskom has also been gradually losing control of the power generation itself. Since 2015, instead of investing capital into extending the lifespans of the electricity generation units which are now very old, the government has been decommissioning them and spending this money on paying private IPPs to supply to the grid. This is despite the fact that Eskom has the capacity to produce electricity at much lower costs that what is charged by the IPPs.
As a result, in 2015, out of the R8.2 billion (USD$570 million) generated from tariff increase, R6.5 billion (USD$451.9 million) went as payments to the private IPPs that have contracts with Eskom for power supply. The following year, when Eskom had “enough capacity to generate a unit of electricity at…[R0.42] (USD$0.029) per kilowatt hour,” more unnecessary contracts were signed with IPPs, which then sold power to Eskom at a much higher price, causing the SOE a loss of R9 billion (USD$625.9 million).
Again, in 2018, the then Energy Minister Jeff Radebe, on behalf of Eskom, signed another R56 billion (USD$3.89 billion) contract with 27 more IPPs, despite the strong opposition by the unions. That year alone, R21.3 billion (USD$1.48 billion) was spent on paying the IPPs, from which Eskom bought electricity at R2.22 (USD$0.15) per kilowatt and sold at R1.38 per kilowatt hour, costing the company a loss of R13 billion (USD$904).
In the meantime, the private IPPs are making profits at the cost of Eskom. This is not because the private companies are inherently better at adapting to the changes in supply and demand. On the contrary, the “must buy first principle,” on the basis of which government-guaranteed Power Purchasing Agreements have been signed with the IPPs, ensure that these “IPPs are guaranteed payment from Eskom whether or not there is a demand,” according to NUMSA.
According to the joint memorandum submitted by NUMSA, Eskom in the recent period has been buying power from IPPs at R4.04 ($0.28) per kilowatt and selling it to public at R0.83 ($0.058) per kilowatt, as a result of the nature of these contracts.
This government-imposed resource drain on the SOE has left Eskom with little capital to invest in extending the lifespan of its generators, which have exhibited signs of deterioration since 2015.
Unions have been demanding a reversal of these policies. Specifically, they are demanding the cancellation of the exorbitantly priced contracts handed over to the private IPPs. In its place, the power-production tasks should be insourced into Eskom, and money saved from cancellation should be invested into extending the lifespan of existing generators or acquiring new capacity.
Unions resist the government’s ploy for privatization
The government, on the other hand, is using the very fact that most of its generators are reaching the end of its lifespan to justify the decommissioning of more plants from the SOE and replacing them with more contracts to private IPPs.
The need to transition from coal to renewable energy is also being opportunistically used by the government to justify the policy of decommissioning publicly owned coal plants and outsourcing the energy requirement to privately owned Renewable Energy Independent Power Producers (REIPPs).
While both Gordhan and President Ramaphosa have time and again sought to reassure the public that the government is not seeking to privatize Eskom, NUMSA has called it “a lie”.
“In actual fact every power station that is being decommissioned is being replaced on the grid by REIPPs. REIPPs are owned by the private sector and therefore this constitutes nothing but privatization.
Hlubi Majola warns that “privatization of Eskom will mean that electricity will become even more expensive and inaccessible to members of the working class and the poor. Only a cheap [supply of] electricity, through a state-owned entity like Eskom, can.. ensure that we have a regular power supply and allow.. our economy to grow in the long-term.”
NUMSA, which has for long advocated a transition to clean energy, is not opposed to a transition to renewable sources. The transition, however, “must be at a pace and cost that the country can afford,” the union insists. “As things stand, with coal you can produce electricity at a rate of.. [R0.55] ($0.038) per kilowatt hour, but with REIPPs you will produce that same electricity at a whopping R2.35 ($0.16) per kilowatt hour.”
Instead of handing over the strategic power sector to overcharging private players under the cover of transitioning to renewable energy sources, NUMSA calls for a socially-owned renewable energy sector, created by setting up “Eskom Renewable Energy Company that will execute 70% of the” renewable energy projects set out in the Integrated Resource Plan (IRP) 2019. All the projects set out in this document are to be completed by 2030.
In order to back up their demands, the unions are mobilizing for a series of actions. The picket yesterday was “just one of a series of marches and demonstrations”, Hlubi Majola asserts. “There is even a possibility of a national strike which we are calling for, as NUMSA and NUM, in order to defend Eskom against unbundling and privatization.”
The crisis of South Africa’s energy company and unions’ plan to save it
Just found about the island nation of Mauritius
This shyt is beautiful brehs:
fukk Europe this is worth visiting.
@Elle Driver its not far from East Africa 
This shyt is beautiful brehs:
fukk Europe this is worth visiting.
@Elle Driver its not far from East Africa 
Elle Driver
Veteran
I believe the majority are Indian.Just found about the island nation of Mauritius
This shyt is beautiful brehs:
fukk Europe this is worth visiting.
I think so too. Thats crazy
Elle Driver
Veteran
It’s a lot of them in Réunion too.
Damn that island is beautiful
Elle Driver
Veteran
It’s a lot of little islands surrounding Africa that are so beautiful.
Im working on some business ideas, Im trying be a consultants, but man Im trying work remotely so I can see and experience this world. That 9 to 5 sitting in traffic, coming and going for 50-60k aint it.
Elle Driver
Veteran
The best time to do that would be right after college or if you live with family, split bills, and can take all that time off to see the world. Most people just can’t afford it and most jobs won’t give you more than two weeks off of vacation time.