Business for South Africa (B4SA), the alliance of volunteers formed to support the national response to COVID-19, has welcomed President Cyril Ramaphosa’s announcement about the easing of certain restrictions, which bolsters the much-needed efforts to boost and stimulate economic activity. However, B4SA has highlighted the importance for South Africa’s economic recovery to implement infrastructure projects, as soon as possible, to boost economic growth and job creation. This imperative has become more abundantly clear following today’s release of Statistics South Africa’s (Stats SA) Quarterly Labour Force Survey (QLFS) for the third quarter of 2020. Quarter on quarter, the survey recorded a 7.5% increase in the number of unemployed people, which is the highest rate recorded since the start of the QLFS in 2008. Expanded unemployment has reached its highest ever level of 43.1% demonstrating the need for the country to urgently pivot onto a sustainable inclusive growth trajectory. Please click here to peruse.

As South Africa considers the path towards recovery and the risks the government’s fiscal policy poses to that recovery – the capacity and cost of the state and in particular the public sector wage bill is a crucial factor. BUSA commissioned Intellidex to research various aspects of the public wage bill in SA. They produced a report titled: “The Public Sector Wage Bill-an evidence-based assessment and how to address the challenge.”

The report utilises data released by National Treasury, as well as the Quarterly Employment Survey released by StatsSA, which measures the full public sector. The critical findings of the report were summarised in a BUSA media statement. The full report is available here.

Psychologist Daniel Kahneman was awarded the Nobel prize for economics for his work on how we make decisions. A common mistake he identified is WYSIATI – what you see is all there is, writes JP Landman from Nedgroup Investments in a recent article. "We focus on one thing and do not see the bigger picture. In October there were three important political announcements about the economy: the Expropriation Bill, the Post-Covid-19 Recovery Plan, and the mid-term budget. When combined, they paint quite a picture of where we are going." Both the President’s and the Finance Minister’s statements have made it clear that the chosen path is structural reform – making changes in the economy to improve productivity and longer-term growth. Growth salvation will not come from the Budget, but from structural reforms in the real economy. Boring and not headline-catching, but real. In fact, general criticism about the Recovery Plan was that it is nothing new. Precisely. No easy money, no new policies – just working to improve the basics. When parliamentarians denounced that the plan is a repeat of old ideas, the President conceded. What he offers, he said, is a new resolve and political will. So, is there evidence of a new political will? Please click here for the complete article by JP Landman from Nedgroup Investments.

Following President Ramaphosa’s address to the nation on Wednesday, the Minister of Cooperative Governance and Traditional Affairs has made amendments to the level 1 Regulations under the Disaster Management Act. Under alert level 1, supermarkets and bottle stores were only permitted to sell liquor for off-site consumption from 9:00 until 17:00 on weekdays. This provision has now been removed which means that the sale of liquor will revert to the hours designated by a retailers’ liquor license as was the case prior to the state of national disaster. The other significant amendment is the scrapping of the so-called ‘red list’ of countries with high infection rates. Residents from these countries could previously not travel to South Africa for leisure purposes under alert level 1. By scrapping this list, all international leisure travelers are now subject to the same requirements for entry, namely a negative Covid test, not older than 72 hours. The amendments came into operation on Thursday, 12 November 2020. Please click here to view the new amendments.

The Bill was the subject of protracted engagements at Nedlac but is likely to make waves again in Parliament as the latest version tabled in Parliament differs from the final version engaged on at Nedlac. In short, the Bill permits the Minister of Employment and Labour to set sectoral targets for transformation at various employment levels. Larger, designated employers will need to comply with these targets. Importantly, consultation is required to decide whether or not sectoral targets should strive reflect national or regional demographics. This is particularly important for agribusinesses whose operations largely fall within specific geographical areas. Agbiz head of Legal Intelligence discusses this topic in the linked article.

On 9 October 2020, the Department of Public Works and Infrastructure published the Expropriation Bill, 2020 in the Government Gazette along with an explanatory memorandum. This procedure is required by the Rules of the National Assembly before a Bill is tabled in Parliament by the Executive. Agbiz head of Legal Intelligence Theo Boshoff gave more information on the context, process and impact of the proposed legislation in an interview on the programme Grootplaas. Please click here to view.

South Africa’s primary agricultural employment in the third quarter of the year improved by 1% from the previous quarter to 807 882. This slight quarterly recovery corresponds with the reopening of the economy and certain agricultural commodities during that period. This is important because while the majority of agriculture remained operational since the start of the lockdown period, the sector could not entirely avoid job losses as demand for some products in the sector was somewhat disrupted. When compared to the corresponding period in 2019, employment in this sector was down by 8%. Agbiz chief economist Wandile Sihlobo discusses the data in the linked article.

South Africa’s agricultural machinery sales remained solid in October 2020. Tractor and combine harvester sales were up by 37% y/y and 136% y/y, with 789 units and 26 units sold, respectively. The tractor sales were boosted, to a certain extent, by improved farmers’ financial position following a large summer grains harvest in the 2019/20 production season, combined with higher commodity prices. South Africa’s 2019/20 maize, sunflower seed, and soybeans production was up 37% y/y, 16% y/y and 8% y/y, estimated at 15.4 million tonnes, 785 910 tonnes and 1.3 million tonnes, respectively. Please click here to read the complete article by Wandile Sihlobo.

The most crucial time for SA’s summer crop and some horticulture products, and by extension the livestock sector, is between October and February each year. This is the summer rainfall period and therefore a determinant of the season’s harvest and veld conditions. The 2020/2021 production season commenced at the beginning of October, with prospects of above-normal rainfall in most regions of the country. This means the possibility of a large harvest. October itself actually produced below-normal rainfall, but with La Niña-induced higher rainfall set to begin in November there have already been good showers in most regions of the country. Wandile Sihlobo discusses this topic in the linked article.

The latest issue of BUSA Covid-19: Cargo movement update — the 14th of its kind — contains a combined overview of the flow of air, sea, and road freight to and from South Africa in the last week. The report provides a consolidated view of the different modalities published earlier by the Business for South Africa supply chain team. The report concludes that the available supply chain indicators point out that there will be no “quick-fix” recovery from the Covid-19 induced economic contraction. Furthermore, the indicators continually show that the effects will last long into 2021, and probably even 2022. We continue to hope that the South African supply chain and greater trading community continue to pull together and ensure that everything possible is done to mitigate the impact of Covid-19 on the industry. Please click here to peruse.

The Animal Feed Manufacturers Association (AFMA) has announced the University of Pretoria (UP) as the 2020 AFMA Intervarsity Writer's Cup Champion. This competition aims to encourage universities, promoters and students to communicate relevant research information to stakeholders in the animal feed industry. This year, AFMA presented the Intervarsity Writer's Cup to UP for the article submitted by Amelia du Preez, a doctoral student under promotership of Prof. Edward Webb at UP’s Department of Animal Science: Faculty of Natural and Agricultural Sciences. The article titled “Effects of different feeding systems on scrotal fat accumulation and semen quality of Merino-type sheep” features in the October/December issue of the AFMA Matrix. Please click here to read the full AFMA media statement. In the photo are: Prof. Edward Webb of the Department of Animal and Wildlife Sciences at the University of Pretoria; Karla Hendriks, AFMA technical advisor; Amelia du Preez, student award winner; and De Wet Boshoff, AFMA executive director.

Justin Chadwick, CEO of the Citrus Growers' Association of Southern African, shares the latest news in the citrus industry in his weekly update - From the desk of the CEO. Please click here to peruse.

Read more about the latest developments and news in the pork industry in the South African Pork Producers' Organisation's (SAPPO) newsletter, SAPPO Weekly Update.

For more information, please visit the congress web page.