Why the lack of interest, Cyril?
The president’s apathy over the country’s crises could mean a coalition is on the cards
Cyril Ramaphosa has been chalking up provincial nominations to get a second term as the ANC’S president at its national conference in December. But it is not clear why members are so keen to vote for a leader who has achieved so little, is so invested in an Eskom board and chief executive who have wrecked the country’s power plants, and in failed economic policies, that he is prepared to throw the 2024 national elections.
There was so much goodwill when he became ANC president on 18 December 2017. Party members thought his personal popularity would give it an electoral boost.
In financial markets, there was a wave of optimism before and after his election. The rand appreciated 20% against the dollar to a high of R11.50 on 26 February 2018, from a low of R14.40 on 15 November 2017.
Five years later, there is so little to show. In the 2019 national election, the ANC’S share of votes declined to 57.5% from 62.2% in 2014 when Jacob Zuma was president.
In last year’s municipal elections, the ANC’S share of votes plunged to 46.12% from 54.48% in 2016. The ANC lost 2.7-million votes as many of its supporters stayed at home.
With a deadly cocktail of power blackouts, rising interest rates and austerity policies, there will be no good story to tell during the 2024 election campaign and the party’s support is expected to drop far below 50%, unless Ramaphosa can gets a grip on Eskom and the economy.
The energy availability factor (EAF) is now the most important macroeconomic policy indicator. If it does not improve, the economy cannot grow and create jobs.
After his election, one of the first things Ramaphosa did was to appoint a new board at Eskom. Eskom’s plants were in top condition, a whisker away from its targets.
In 2009, according to the National Society of Black Engineers, the company set targets to achieve an EAF of 80%, unplanned breakdowns of 10% and planned maintenance of 10%.
In March 2018, the technical indicators showed Eskom had an EAF of 78%. Unplanned breakdowns were at 10.2% and planned maintenance was at 10.4%.
The society’s analysis of Eskom’s annual reports debunks the company’s propaganda that there had been too little maintenance or the plants had been run too hard.
The wheels came off immediately after the new board was appointed. There has been a dramatic decline in plant performance. The EAF plunged to 56% this month and was at 50% at one stage. Unplanned breakdowns have soared to 31.2% and more than 20000MW is regularly down for various reasons.
Eskom is burning 54-million litres of diesel a month — more than the 37.8-million litres burnt during the whole of 2018.
As he returned to South Africa, from attending the funeral of Queen
Elizabeth II, Ramaphosa must have noticed public outrage was much higher than it was at the end of June when the country also had stage six blackouts, with many people calling for heads to roll.
At a lecture at Unisa, former president Thabo Mbeki questioned the competency of the board and called for the appointment of engineers.
Ramaphosa must listen to South Africans and replace the board and CEO. An interim board and a CEO who have engineering expertise must be appointed, with an 18month mandate to stabilise the fleet.
Former CEO Jacob Maroga is the people’s choice to lead the utility.
In his first State of the Nation address in 2018, Ramaphosa announced several summits to revive the economy and promised to develop a social compact. Four years later, there is no social compact. There is no plan to grow the economy and address the crises of unemployment, poverty and inequality.
The economy has created one-million jobs during the first two quarters of this year, probably a bounceback after the end of the Covid restrictions to the pre-pandemic normal. But South Africa is much worse place than it was five years ago and is emerging from the deepest recession in a century, a woefully inadequate fiscal response of only R27-billion, a cost-of-living crisis and a winter of power blackouts, unpaid social grants, mass shootings, gender-based violence and rising levels of xenophobia.
From the fourth quarter of 2017 to the second quarter of this year, the labour force has increased by almost 2.5-million to 27.8-million. The economy shed about 600 000 jobs and the number of unemployed people increased by 3.1-million to 12.3-million. The unemployment rate has increased to 44.1% from 36.3%.
On average, South Africans are poorer than they were in 2017. GDP per capita declined by 5.1% between 2017 and last year. GDP per capita is where it was in 2006.
South Africa needs a shortterm solution to the power crisis. Independent renewable power producers will not solve the power crisis in the short term.
Eskom’s management has demonstrated that it has no interest in fixing the current fleet. With an EAF of 75%, it could add almost 7 000MW to the grid.
Some people believe the reason Ramaphosa appears to show so little interest in addressing the country’s power and economic crisis, and winning the next election, is because he is preparing for a coalition government with the DA.
But taking the instability of municipal coalition governments to the national level would create chaos — with breakaway alliances with other parties such as the EFF in some provinces and the possibility of opposition parties uniting to keep the ANC out of government — and make it less likely to reach agreement on a plan to revive the economy.
Also, it is difficult to see the benefits of an alliance between two parties that believe in neoliberal economic policies. There would be privatisation on steroids.
The government’s structural reforms will not reverse unemployment, poverty and inequality. The Reserve Bank and treasury must stop strangling the economy with higher interest rates and austerity.
Ramaphosa must listen to South Africans and replace the board and CEO of Eskom