South Africa’s economy at a pivotal point as outlook improves but political, energy risks remain
LONDON – South Africa’s President Cyril Ramaphosa speaks during a press conference in central London on November 24, 2022
JUSTIN TALLIS/AFP via Getty Images
South Africa’s long-awaited economic reforms have begun to improve the country’s outlook, but the age-old problems of political uncertainty and a failing power system still pose significant risks.
The Economic Reconstruction and Recovery Plan has been a key tenet of President Cyril Ramaphosa’s agenda since he succeeded Jacob Zuma as the country’s leader in 2018. But deep divisions within the ruling African National Congress (ANC) and his own cabinet have made for sluggish progress.
The suite of reforms — focused on energy security, infrastructure development, food security, job creation and the green transition — is designed to create a “sustainable, resilient and inclusive economy,” the government says.
And — some at least — appear to be working. S&P Global Ratings earlier this month affirmed its positive outlook on the country, saying that government measures to stimulate private sector activity could boost growth, and the measures had the potential to ease economic pressures.
“There is some hope in the public finances in South Africa, mainly due to the increase in government revenues as a result of higher commodity exports, and also due to the progress made in reducing debt and debt distress, and to ushering a public deficit,” Aleix Montana, Africa analyst at risk consultancy Verisk Maplecroft, told CNBC last week.
However, political frailties and persistent issues at a state-owned utility continue to pose present economic risks.
Ramaphosa faces a “perfect storm of inflation, electricity cuts and corruption accusations that will continue to deteriorate South Africa’s profile and to pose risk for investments in the country,” Montana said.
A report into an alleged corruption scandal surrounding Ramaphosa is set to be examined by the National Assembly on Dec. 6, just 10 days before the party conference of his ruling ANC (African National Congress).
Energy woes
Though Ramaphosa is expected to secure a second five-year term, Montana said he will have to improve his credibility on economic and anti-corruption reforms in order to continue pushing through his agenda. The economy also remains at risk from persistent disruptions at state-owned companies, such as power utility Eskom.
South Africans have faced rolling blackouts as Eskom — which has long been a thorn in the side of the country’s economy — contends with shortfalls in generation capacity due to equipment failures and diesel shortages.
The company has warned that power outages, known as “load-shedding,” will continue for the next six to 12 months, and recently said it had run out of funds to acquire the diesel needed to run auxiliary power plants that are deployed during periods of peak consumption or emergencies.
Montana said that in order to secure sustained economic growth, the South African government will need to prioritize energy sustainability.
“Energy will require financial assistance from international players, but they will also need to ensure that it doesn’t have a negative impact on South African society,” he said.
“Apart from financial challenges, a lot of citizens of South Africa are employed in Eskom or in the fossil fuels sector, so the government will need to ensure that in their plan, they mitigate this potential impact of transitioning from a fossil fuels-based economy to the implementation of renewables in order to sustain electricity stability.”
Asked about this issue on a recent state visit to the U.K., Ramaphosa told CNBC’s Arabile Gumede that the problems at Eskom started long before 2014, when former President Jacob Zuma appointed him to address the country’s energy problems.
“As we are generating electricity, power stations keep breaking — many of them are old — but we are trying with a new boat, the management that’s in place to address this problem,” Ramaphosa said.
“So the problems of Eskom were seeds that were planted many years ago, rather than in 2014, and because we’re dealing with huge, complicated and complex machinery, it’s not a one-day fix, it can never be as these are very complex processes.”
He added that the government was working to reduce load-shedding requirements and to “ensure that the money’s there,” noting that Eskom “used to be the best utility in the world.”
“Do I have confidence that we will solve these problems? Yes, I do. I do have enormous confidence that we will solve them,” he said.
“But I think it’s important to have an appreciation of where we’ve come from, and obviously, it is very easy to put all the blame on the president, to put all the blame on the government, and yet these problems have come way back from the past.”
‘Taming the monster’ of inflation
Along with the domestic issues unique to South Africa, the country also faces the same inflationary pressures that have plagued economies around the world over the past year.
Annual headline inflation rose to 7.6% in October, defying the South African Reserve Bank’s expectations for price pressures to ease. This prompted the bank’s Monetary Policy Committee to hike interest rates by an aggressive 75 basis points last week, taking the benchmark repo rate to 7%.
This marked the seventh consecutive meeting at which monetary policy had been tightened, and central bank Governor Lesetja Kganyago said in a press conference that it must “tame the monster of inflation.”
With prices rising much faster than the central bank’s 3-6% target, Kganyago noted that the SARB needs to see clear evidence that inflation has not just peaked, but begun to sustainably decline toward the midpoint of the range.
But further monetary tightening will place additional pressure on the economy.
“We think that inflation is unlikely to return within the target range (let alone the midpoint) in the coming months, keeping policymakers in tightening mode well into 2023,” said Virág Fórizs, emerging markets economist at Capital Economics.
She flagged that food inflation continues to increase, offsetting some of the effects of softening fuel price pressures, while core inflation is likely to remain high. Capital Economics expects inflation to hover around 7.5% annually until early 2023, before dropping markedly around the middle of the year.
Fórizs said the weakness of the economy is unlikely to prevent further rate hikes, with growth concerns playing second fiddle to inflation worries. South African GDP contracted by 0.7% in the second quarter.
“While the end of the tightening cycle is not yet in sight, we expect the pace of tightening to slow over the next MPC meetings,” she noted.
Three MPC members voted to hike rates by 75 basis points last week, while two voted for 50 basis points. It marked an apparent softening of approach by some who voted for a 100-basis-point rise at the previous meeting.
“All in all, we’ve penciled in 100bp of further increases in the repo rate, to 8.00%, by Q2 2023,” Fórizs said.
Japanese equipment giant Komatsu dropped its new, 320-ton Power Agnostic 930E mining truck at MinsExpo trade show in Las Vegas, calling it a future-ready solution that can run on diesel, hydrogen, or pure electric power.
Komatsu continues to develop alternative engine technology with the release of its first commercial rigid-frame dump truck with a “power agnostic” platform for running on diesel, hydrogen, or even battery electric power.
That’s because the platform is designed around the concept of a modular powertrain. The design not only gives the Komatsu assembly line an easy way to build diesel, BEV, and hydrogen fuel cell rigid haulers on the same line, but also enables customers to upgrade from diesel to battery electric or hydrogen down the road, if and when whatever logistical obstacles that are preventing them from running an electric or hydrogen solution today are overcome.
“This platform enables mining companies to start with conventional diesel engines and gradually transition to cleaner energy sources as needed, including utilization of trolley assist for diesel or as one of the future dynamic charging solutions for battery trucks to reduce fuel consumption and emissions,” reads Komatsu’s press material. “Whether adopting battery technology, hydrogen fuel cell technology or a combination of energy systems, the Power Agnostic 930E provides the infrastructure and adaptability necessary to meet evolving sustainability goals.”
Potential customers got a sneak peek at the concept truck, which they were apparently allowed to test at Komatsu’s Arizona proving grounds ahead of MineExpo (I wasn’t invited). The first pre-production Power Agnostic 930E prototype will make its way to Sweden in the coming months, where it will be put to work alongside other electric Komatsu machines in Boliden’s Aitik copper mine, one of the largest such operations on the European continent.
Electrek’s Take
Converting gas and diesel-fueled cars to electric at scale is a concept that’s fraught with problems. Far too many to list here, in fact. But heavy equipment?
Everything from excavators to loaders to heavy trucks are already built to be powertrain agnostic, and manufacturers will often offer the same basic vehicle with Cummins, Detroit Diesel, or Volvo Pentapower, so there’s a degree of openness baked into those systems already. Komatsu is just taking that to the next level by adding a modularity of energy storage (fuel tanks, hydrogen cells, or battery packs) to the mix. And, if the project is successful, it could be the first of many.
SOURCE | IMAGES: Komatsu; Equipment World.
FTC: We use income earning auto affiliate links. More.
isinwheel’s terrific personal EVs “bring all the things you want closer to you.” Whether it’s an electric scooter, an e-bike, or an e-skateboard, the three things you’re guaranteed to get no matter which you choose are fun, safety, and affordability.
We’re taking a closer look below at six of isinwheel’s personal EVs – could one of these be your next electric ride?
Table of contents
isinwheel S9Pro commuting electric scooter
Meet the isinwheel S9Pro, the best value-for-money electric scooter that zips you through your day at speeds up to 19 mph with a range of 19 miles – perfect for your daily commute.
The S9Pro‘s powerful 350W motor delivers a smooth, efficient ride without breaking the bank. With a lightweight, foldable aluminum frame, it’s easy to carry, store, and even pop into your car trunk or onto public transport. Plus, the quick one-step folding mechanism makes it the ultimate on-the-go companion.
You can find the S9Pro on Amazon here.
isinwheel S10Max long-range electric scooter
The isinwheel S10Max is your ultimate high-performance ride, powered by a beastly 1000W motor that conquers any terrain with ease. With an impressive range of up to 37 miles, you can enjoy long-distance adventures without worrying about recharging.
The S10Max‘s all-terrain 10-inch off-road tires, paired with dual shock absorption, provide unbeatable grip and stability whether you’re cruising through city streets, on country paths, or on muddy trails.
You can find the S10Max on Amazon here.
isinwheel GT2 off-road electric scooter
Unleash your adventurous side with the isinwheel GT2. With a powerful 1000W motor, it rockets up to 28 mph, effortlessly conquering steep hills and challenging landscapes for a thrilling ride every time.
Its 11-inch off-road tires are built for all terrains, whether you’re cruising through the city or tackling rugged countryside paths. Plus, with four advanced shock absorbers, every ride is smooth and stable, no matter where your journey takes you. Get ready to ride the GT2 and experience performance like never before!
You can find the GT2 on Amazon here.
isinwheel M10 electric commuter bike
The isinwheel M10 electric commuter bike blends style with power. Crafted from lightweight, rust-resistant aluminum alloy, this sleek ride weighs just 47 pounds, making it easy to carry and tough enough to last.
With a professional 35-speed transmission, the M10 adapts to your every need, whether you’re accelerating, cruising downhill, or conquering steep inclines. With a 500W motor capacity, a top speed of 20 mph, 374 Wh battery capacity, and four hours of charging time, it’s the perfect blend of performance and convenience for your daily commute!
You can find the M10 on Amazon here.
isinwheel U1 folding electric bike
Say hello to the versatile isinwheel U1! With folding handlebars, pedals, and a height-adjustable seat, it’s perfect for easy storage and transport. The U1’s 500W motor comes with a smart chip that instantly adapts to give you that extra boost when you hit an incline, face a headwind, or carry more weight.
The U1 has a top speed of 18 mph, 280 Wh of battery capacity, and three hours of charging time. Whether you’re zipping through city streets or tackling hills, the U1 has you covered with power and portability.
You can find the U1 on Amazon here.
Check out isinwheel’s V8, V6 and V10 electric skateboards
The isinwheel V8 electric skateboard is your ticket to thrilling rides, featuring a top speed of 28 mph and a range of up to 12 miles. Its removable, detachable batteries allow for quick swaps, so you can extend your adventure with ease. Choose from four riding modes and let the gorgeous ambient lights make you stand out, whether you’re cruising in daylight or lighting up the night. With its powerful dual 540W motors and regenerative braking system, the V8 delivers a ride that’s as exhilarating as it is stylish.
The V8 is isinwheel’s first-gen electric skateboard, and we’ve also taken it to the next level. The V6 is perfect for teens and beginners, and the high-performance V10 is for those who crave more power. But we’re not stopping there – this September, we’re launching the V6 PRO, the ultimate cool ride for young skaters and newbies. Stay tuned; it’s going to be epic!
You can find the V8/V6/V10 on Amazon here.
Follow isinwheel on Instagram here, on X here, on YouTube here, and on Facebook here.
FTC: We use income earning auto affiliate links. More.
It’s no Ferrari, but owning a sporty little Fiat 500e is about as close to putting a cavallino rampante in the garage as most of us will ever get. And if we act soon, we could do just that for 30% less money than before.
Fiat parent company Stellantis is giving dealers the ability to offer buyers up to $3,000 in coupons and incentives to help move its slow-selling 2024 FIAT 500e coupes. When paired with a $7,500 factory lease credit through Stellantis Financial, those coupons lead CarsDirect analysts to call the 500e one of the most affordable new EVs on the market.
The math maths
Between coupons and Stellantis Financial cash, that’s $10,500 in potential discounts before negotiations even begin. With a base MSRP of $34,095 with destination for a 2024 500e, that’s a JC Penney-style 31% off, with an additional 2% (presumably) within easy reach.
According to CarsDirect, the biggest downside of the coupon program is that it’s still unadvertised, which means there’s no way of telling how much of the allowable discount dealers are actually including in prices. But (as GI Joe taught us) knowing is half the battle, so click here to find deals on a new Fiat 500e near you, and make “are you applying those $3,000 in Stellantis coupons” one of your first questions.
Electrek’s Take
Small cars have never sold well in America. Not even great ones like the OG Honda CRX or Suzuki Swift GTi. Americans tend to buy for low use case scenarios, which is a fancy way of saying that, if an American thinks they’ll need a pickup 2-3 days/year, they’ll convince themselves to drive a pickup for the other 362 days. The British want more taxes than Americans wanted to pay in 1775, and today we have more gun shops than McDonald’s … just in case.
The little Fiat, in other words, was never going to be a volume player in the US. And that’s too bad, because the little 117 hp microcar is, by all accounts, fun to drive, zippy, and unquestionably cool. The media at large, though, has complained about the 37 kWh battery and 149 miles of EPA range – calling both “inadequate,” despite the fact that the first-generation Nissan LEAF had objectively inferior specs and sold 200,000 examples before getting its first significant upgrade in 2016. And, frankly, that Nissan had about as much style as a hospital gown.
So, while it may not offer what most car buyers think they need – as a second car, or a fun, urban runabout for lighthearted singles, the little Fiat is tough to beat (especially in red).
Click here to see what it will cost to put one in your garage.
SOURCE | IMAGES: Stellantis, via CarsDirect.
FTC: We use income earning auto affiliate links. More.
-
Sports2 years ago‘Storybook stuff’: Inside the night Bryce Harper sent the Phillies to the World Series
-
Sports6 months agoStory injured on diving stop, exits Red Sox game
-
Sports2 years agoMLB Rank 2023: Ranking baseball’s top 100 players
-
Sports11 months agoGame 1 of WS least-watched in recorded history
-
Environment1 year agoJapan and South Korea have a lot at stake in a free and open South China Sea
-
Sports3 years ago
Team Europe easily wins 4th straight Laver Cup
-
Environment2 years agoGame-changing Lectric XPedition launched as affordable electric cargo bike
-
Business2 years agoBank of England’s extraordinary response to government policy is almost unthinkable | Ed Conway