South Africa

The biggest labor group at South Africa’s Eskom Holdings SOC Ltd. blamed “poor leadership” for ongoing nationwide power cuts, a discordant sign as the utility embarks on a plan to become profitable again, Bloomberg News reported. The National Union of Mineworkers is “very disappointed with the performance” of Eskom Chief Executive Officer Andre de Ruyter and the lack of a plan to prevent outages, it said Thursday in a statement. The group also continues to oppose the use of independent electricity producers, which Eskom is counting on to help increase generation.

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An annual wealth tax on the net worth of South Africa’s richest people could raise as much as 160 billion rand ($10.7 billion) and would narrow inequality in a nation where the most affluent 1% of the population own 55% of personal wealth, a study showed, Bloomberg News. The study, carried out by groups including the World Inequality Lab of which Thomas Piketty is co-director, assessed personal wealth in South Africa and proposed a range of taxes on net wealth of above 3.82 million rand, or the top 1% of the population.
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Seven labor groups representing workers at South African Airways who’ve not been paid since March agreed to accept a settlement offer of three months’ wages, a move that will aid the government’s efforts to revive the bankrupt state airline, Bloomberg News reported. Members of the groups, including the South African Transport and Allied Workers’ Union and the Solidarity union, will also receive a lump-sum payment related to an increase they were owed and part of a year-end bonus, the Department of Public Enterprises Enterprises said in a statement on Thursday.
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South Africa’s state power monopoly says it will need to charge consumers more for electricity if it is to cut its debts and stave off bankruptcy, even as rolling blackouts continue to plague Africa’s most industrial nation, the Financial Times reported. Years of corruption and mismanagement under disgraced former president Jacob Zuma left Eskom with surging costs, falling revenues, a fleet of breakdown-prone coal power stations and ballooning debts.

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South Africa’s biggest pot of available cash — R1.91trn ($128bn) of civil-servant pensions and unemployment funds managed by the Public Investment Corp. — is emerging as the key to rescuing the debt-stricken national power monopoly, BizNews reported. The money manager has approached its parent agency, the National Treasury, with a proposal to ease the R464bn load of obligations crushing Eskom, signaling officials are gearing up for the complex financial and political operation to convert about R95bn of Eskom debt held by the PIC into equity.

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Administrators at struggling South African Airways (SAA) said on Wednesday they have issued a 48-hour notice to prevent nearly 400 pilots from accessing the company’s premises until they agree to new employment terms and conditions, Reuters reported. SAA entered a local form of bankruptcy protection in December of 2019 after roughly a decade of financial losses, and its fortunes worsened after it grounded flights because of the COVID-19 pandemic. Efforts to rescue the state airline face resistance from trade unions, who are at loggerheads with the government over wages.

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South Africa’s government and trade unions are at loggerheads over unpaid salaries at South African Airways (SAA), which could lead to a messy court battle that may further complicate efforts to rescue the struggling airline, Reuters reported. State-owned SAA has not made a profit in almost a decade and was already under bankruptcy protection when the COVID-19 pandemic struck, exacerbating its woes. It halted all but repatriation and cargo flights in March before suspending all operations in September. Some employees have not been paid since March.

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South Africa started a fresh battle with labor groups in its effort to revive the bankrupt state airline, offering three months of wages to employees who haven’t been paid since March, Bloomberg News reported. The government’s Department of Public Enterprises and the National Union of Metalworkers of South Africa agreed to discuss the matter later on Tuesday, according to a spokeswoman for the labor group. Numsa and the South African Cabin Crew Association, another union, had expected members to be paid in full, in line with the country’s legal framework for a business-rescue process.

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The South African government has transferred 1.5 billion rand ($98 million) to administrators for national airline South African Airways (SAA) but the funds cannot be used yet, the administrators said on Thursday, Reuters reported. The administrators said the conditions the Department of Public Enterprises (DPE) attached to how the money should be spent were in contravention of labour and companies laws. “We are unable to utilise the funds until the conditions have been amended by the DPE,” they added in a statement. A DPE spokesman said the department would comment later.

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