South Africa is not short of goals, plans, and ambitions for our various sectors in the economy, but solving the complexities and balancing and counter-balancing the various factors requires wisdom, cooperation, patience, and urgency at the same time.
We need far-sightedness and compromises must be made and weighed up against one another.
Central to all plans is a just transition that puts people at the centre of decision-making, especially those most impacted, including the poor, women, people with disabilities, and the youth— empowering and equipping them for new opportunities of the future. A just transition contributes to the goals of decent work for all, social inclusion, and the eradication of poverty.
South Africa is committed to the attainment of the Sustainable Development Goals (SDGs), the Paris Climate Agreement, and the African Union's Agenda 2063 (African Union Commission 2013) to achieve a prosperous society based on inclusive growth and sustainable development. This ambition is embodied in the National Development Plan: Vision 2030 (NPC 2012), which is the country's blueprint for economic growth and development.
1. Cost of Living
The table below, using data from livingcost.org, shows that it is substantially cheaper to live in India than in South Africa.
However, certain areas stand out that speak to failures that have brought about more misery than others. In India the cost of living for one person is $435, or R8204, 48% less expensive than in costs for a single person in South Africa at $830.
India ranked 188th vs 102nd for South Africa in the list of the most expensive countries in the world.
The average after-tax salary is enough to cover living expenses for 1.5 months in India compared to 1.6 months in South Africa, which are ranked 109th and 116th, respectively, as the best countries to live in the world.
2. The Table below illustrate some typical expense items.
3. The last five items in the Table above highlight the extravagant variance in transportation costs that reflects some serious mistakes of the last couple of decades.
Between 1998/99 and 2008/09, there were an average of 43 million rail passenger trips per month. The Passenger Rail Agency of South Africa (Prasa) collected R1.2 billion in fares, 13 years later, in 2021, it collected R178 million.
Between January 2021 and July 2022, there were an average of 1.7 million rail passenger trips per month. This is 4% of the monthly average over the ten years between 1999 and 2008 and just 3% of Prasa’s peak. From R10 per passenger trip in 2014/2015, it rose to R21 in 2016/2017, to R44 in 2018/2019, and R68 in 2019/2020 (years ending in March).
We all know how cable theft and vandalism have taken their toll and how the taxi industry stepped into the vacuum. The passengers were deserted by the authorities and families struggling to make a living were left to pay the ever-increasing costs.
The difference now between living in South Africa and India is that now travel by taxi is at least twice as expensive as that per train, provided there is a train that operates.
4 The South African Automotive Masterplan (SAAM)
A key focus of South Africa’s commitment is to tackle vulnerabilities in the transport and mobility system. South Africa stands at a pivotal juncture, facing a challenge of profound complexity: how to transition both its automotive market and productive capacity to electric vehicles (EVs) while simultaneously achieving the objectives outlined in the South African Automotive Masterplan (SAAM).
This challenge is compounded by critical energy shortages, the imperative to decarbonise the economy and financial constraints across South African households and the public sector.
South Africa is the largest automotive manufacturing hub on the African continent, but it is also highly integrated into the global supply chain that draws components from across the world, including the Southern African Development Community (SADC) region, and exports the final consumer product to more than 150 countries worldwide.
Of South Africa’s car exports, 65% go to the European Union, and they are worth about R130 billion. However, some EU countries have already set target dates by which no more ICE cars will be sold. This places South African car producers in a predicament and a race against time.
5. We will need more electricity to power EV cars. The question is will we have enough capacity? As pointed out by energy experts, the government often builds its plans and policies based on incorrect assumptions, such as the energy availability factor (EAF) of Eskom power stations.
An assumption for instance that is based on an availability factor of 75% makes any plan obsolete compared to the reality of Eskom's availability as Chris Yelland posted Eskom’s latest energy availability factor numbers, which showed that its week-on-week EAF for week 28, 2023, stands at 56.28%.
The trend is downwards and that is not going to change in the short term. The EAF is based on the average performance of 90 generators in Eskom’s electricity generation fleet.
Getting rid of CO2 emissions is an expensive exercise. Our commuters have been left stranded without transport and have been required to carry the cost of a total failure in transport policy and implementation thereof.
Most South Africans who are affected by the failure of the transport policy and plans are the poor. Looking ahead, the government’s plans do not seem robust in the face of lack of resources and capacity. This indicates that South Africa’s costs of living will continue to remain high unless its sets achievable goals.
Corrie Kruger is an Independent Analyst
BUSINESS REPORT