Engineering News Online Audio Articles

The National Energy Regulator of South Africa (Nersa) has confirmed that Eskom has not applied for a Ministerial determination for a 3 000 MW combined cycle gas power plant at Richards Bay in terms of the Integrated Resource Plan of 2019 (IRP2019), but is instead seeking permission to deviate from the IRP2019.

On September 12, Nersa circulated an erratum to a consultation paper published for public comment on August 25 in relation to it providing concurrence to a Ministerial determination for the procurement of 3 000 MW of gas-fired electricity.

In its original notice and consultation paper, the regulator said that the 3 000 MW was based on an allocation for gas/diesel generation outlined in Table 5 of the IRP2019.

The table shows the allocation of 1 000 MW of gas/diesel by 2024 and 2 000 MW by 2027, and the original consultation paper stated that the Minister had determined to procure the total capacity of 3 000 MW of gas before 2028.

In the erratum, however, Nersa clarified that the gas determination under consideration for concurrence related to an application submitted by Eskom to Mineral Resources and Energy Minister Gwede Mantashe on January 13 and not Table 5 of the IRP2019.

“The correction seeks to explain that the request for the determination had not originated from the IRP2019 as indicated but from an Eskom application to the Minister in terms of Section 10 (2)(g) of the Electricity Regulation Act (ERA),” Nersa told Engineering News in response to an enquiry, adding that it had mistakenly linked the determination to Table 5 of the IRP2019.

The regulator noted that Section 10(2)(g) of the ERA required every application for a generation licence to include “evidence of compliance with any Integrated Resource Plan applicable at that point in time or provide reasons for any deviation for the approval of the Minister”.

“Eskom had accordingly applied for a deviation from IRP2019 and in accordance with the prescripts of [the] ERA, Eskom is obliged to provide reasons for the need for such a deviation,” Nersa explained.

Following the public comment process, the regulator would conduct its own analysis and “make a decision on whether to concur or not with the Ministerial Section 34 determination based on the legal prescripts and facts and evidence presented or collected by it”.

Asked by Engineering News whether, given the late correction, Nersa felt the September 16 closing date for comment to be sufficient, the regulator responded: “Yes, since the change only applies to the origin of the capacity while everything else contained in the consultation paper remains the same.”

The original consultation paper had an initial closing date for public comment of September 23, which was subsequently revised to 16:30 on September 16.

The earlier deadline is also applicable to consultation papers related to two other Ministerial determinations for 14 791 MW of ‘Storage’, ‘PV’ and ‘Wind’, for the years 2024 to 2030 and 1 000 MW in accordance with the heading ‘Other Distributed Generation, Co-Gen, Biomass, Landfill’, for the years 2023 and 2024.

The deadline for the renewables determination was shifted earlier to accommodate a doubling of Bid Window Six (BW 6) of the Renewable Energy Independent Power Producer Procurement Programme to 5 200 MW, for which a September 22 bid submission date was set.

However, the National Energy Crisis Committee announced on September 11 that the BW 6 request for proposals (RFP) would be reduced to 4 200 MW, given that the Nersa still needed to concur with a Ministerial determination opening the way for the procurement of more solar photovoltaic (PV) capacity.

“Rather than delay this RFP for all requests to be approved, government opted to issue the current RFP for 4 200 MW as opposed to delaying the entire Bid Window.

“A further announcement regarding the remaining 1 000 MW of solar PV will be made following the conclusion of the Nersa process regarding the concurrence of the new determination,” the commit...

JSE-listed Metair Investments and its subsidiary, Hesto Harnesses, along with President Cyril Ramaphosa, on September 13 officially launched the new Hesto vehicle wiring harness manufacturing facility in KwaDukuza, KwaZulu-Natal.

The new 35 000 m2 Hesto facility is one of five capital investment projects which resulted in a commitment of over R1.4-billion by Metair to support the expansion and localisation of the new Ford Ranger, through automotive component contracts.

In partnership with global automotive parts supplier Yazaki Corporation, Hesto employs manufacturing skills and processes to produce wiring harnesses and instrument clusters for supply to South Africa-based, automotive original-equipment manufacturers (OEMs) Toyota South Africa Motors, Isuzu, Nissan, and recently added, Ford Motor Company of Southern Africa (FMCSA).

The new facility will produce wiring harnesses for the latest Ford Ranger and Isuzu models, which will be sold locally and abroad.

This follows a R15.8-billion investment by FMCSA in its Silverton assembly plant, in Pretoria, and major supplier factories, as announced in 2021, which will enable the company to support production of the next-generation Ford Ranger.

Other subsidiaries involved in these projects include Unitrade 745, Automould, Lumotech and Supreme Springs, with a variety of wires, plastic and chrome plated parts, suspension parts as well as headlights and tail lights being produced.

The investment commitment by Metair is an outcome of the South Africa Investment Conference held in 2020 and directly aligns with the objectives of the South African Automotive Master Plan to 2035 (SAAM2035), with the new facility posited to increase localisation, develop skills and create employment.

Speaking at the launch, Ramaphosa said this investment showcased the long-term commitment by FMCSA and Metair to South Africa and underpinned their confidence in the country’s role in the global automotive value chain.

Metair CEO Riaz Haffejee said the new facility took about nine months to complete, since the groundbreaking last year and that R804-million had been invested in the facility.

A key benefit on the new facility that was lauded during the launch was the employment it has engendered, with 4 000 jobs created, more than doubling Hesto’s staff complement.

Ramaphosa lauded this achievement, especially given that it includes the youth of the country, and further, boasts a 70% female representation.

He also pointed out that the localisation targets would benefit the surrounding communities. Ramaphosa said such strides in localisation were aligned to aims outlined in the SAAM2035 and called for a continued drive in this area.

Hesto MD William Hilditch pointed out that Hesto was the largest employer in the area and said it was proud of its role in empowering the greater iLembe district community.

“The government support to both Ford and Isuzu unlocked this opportunity for Hesto to grow its operations, both in KwaDukuza and Tshwane, and contribute significantly to employment, economic growth, skills development and transformation.

“Our drive to increase localisation across our business has enhanced this impact. Our country has the resources and skills available to localise more and we believe that, through closer collaboration across the value chain, there is much more that can be achieved on this front,” Hilditch commented.

Haffejee echoed these sentiments, noting that the new facility was testament to the Metair group’s customer commitment and drive to support the sustainability of the automotive sector through enhanced localisation and global skills transfer.

“I am extremely proud of what the team at Hesto has achieved and extend our appreciation to our partners and other stakeholders, specifically Ford and Yazaki, for making this project possible,” he outlined.

Haffejee said Metair had driven several localisation projects in support of OEMs and the SAAM2035 agenda through its South Africa-based subsidi...

The National Energy Regulator of South Africa (Nersa) has published an erratum to a consultation paper published for public comment on August 25 in relation to it providing concurrence to a Ministerial determination for the procurement of 3 000 MW of gas-fired electricity.

The original notice and consultation paper said that the 3 000 MW was based on an allocation for gas/diesel generation outlined in Table 5 of the Integrated Resource Plan of 2019 (IRP2019).

The table shows the allocation of 1 000 MW of gas/diesel by 2024 and

2 000 MW by 2027, and the original consultation paper stated that the Minister had determined to procure the total capacity of 3 000 MW from gas before 2028.

The original consultation paper raised questions as, in 2020, Mineral Resources and Energy Minister Gwede Mantashe Gazetted a Ministerial determination for 3 000 MW of gas to power for the years 2024 to 2027.

In the erratum, Nersa clarified that the gas determination under consideration for concurrence actually related to an Eskom application submitted to the Minister on January 13 for a determination relating to a combined cycle gas power plant at Richards Bay, rather than Table 5 of the IRP2019.

It does not indicate how Eskom and the Minister have sought to justify the allocation in terms of existing IRP2019 allocations, but the consultation paper states that the ever-declining performance of Eskom’s coal fleet meant that “baseload and mid-merit capacity must be added to the grid in order to ensure that the System Operator is able to balance the grid with the aid of dispatchable capacity”.

It also highlights that about 24 100 MW of coal generation capacity is planned to be decommissioned in the period beyond 2030 and that gas could minimise dependence on diesel.

Nersa also confirmed that the public comment deadline, which was originally set down as September 23, had been revised to 16:30 on September 16.

Forestry, Fisheries and the Environment Minister Barbara Creecy has initiated public consultations on the exclusion of solar photovoltaic (PV) installations from the need to secure an environmental authorisation when located in areas of medium or low environmental sensitivity.

The Minister has given the public 30 days to comment on the proposed exclusion, which is provided for in Section 24(2)(e) of the National Environmental Management Act.

The move is in line with an announcement made by President Cyril Ramaphosa on July 25, when he unveiled a so-called Energy Action Plan to tackle intensifying load-shedding.

In his speech, Ramaphosa announced that government would waive or streamline certain regulatory requirements to accelerate investment.

“This includes reducing the regulatory requirements for solar projects in areas of low and medium environmental sensitivity.

“It also means Eskom can expand power lines and substations without needing to get environmental authorisation in areas of low and medium sensitivity and within the strategic electricity corridors,” the President said.

In a Gazette notice, published on September 8, Creecy noted that a screening tool had been developed to identify the environmental sensitivity of specific locations.

These sensitivities are rated from ‘very high’ and ‘high’ to ‘medium’ or low’.

Based on environmental sensitivity, the Act allows for activities to be excluded from obtaining an environmental authorisation in areas demarcated to be of a low or medium sensitivity.

Under the proposed rules, solar PV developments or expansions in low or medium sensitivity locations can apply for an exclusion, along with any associated activities, and instead opt for registration.

“At least 15 days prior to the expected commencement date of the proposed development or expansion, the proponent must register or re-register the proposed facility and infrastructure with the competent authority,” the notice, which includes proposed registration documents, reads.

If the project has a site sensitivity verification report and the documentation is correctly completed, the competent authority has ten days to provide a registration number.

State-owned utility Eskom will continue to implement load-shedding for the rest of this week, with the potential for the stage to be either increased or decreased on short notice, depending on the units being returned to service or further breakdowns, COO Jan Oberholzer indicated during a briefing on September 12.

As previously communicated by the entity, Stage 3 is currently being implemented, and will continue until 05:00 on Tuesday morning. From then, Stage 2 will be implemented for the rest of the week, until midnight on Friday.

Oberholzer outlined that over the course of last week, considerable capacity was lost owing to unplanned outages, combined with planned maintenance. About 11%, or just under 5 200 MW are on planned maintenance, and during the week, 42 units tripped, some more than once, which equated to just under 24 000 MW of capacity lost.

Eskom has since managed to return 37 of these units, about 22 0000 MW of capacity.

This led to different stages of load-shedding being implemented over the week, with Stage 4 implemented over the weekend owed to “drastic” measures needing to be taken on Saturday morning to replenish diesel and pump storage levels.

Oberholzer said there was no indication that these breakdowns were an act of sabotage.

Oberholzer termed this a “very disappointing week” in terms of generation performance for the entity and apologised to South Africans for the continued implementation of load-shedding, with Eskom unable to meet its mandate of providing sustainable electricity to the country.

He said the Stage 2 and 3 load-shedding for this week was necessary to ensure that dam and diesel levels remain sufficient while the remaining units are brought back to service.

Oberholzer said that, in the lower demand summer period, sporadic load-shedding would remain, with planned maintenance to occur. He indicated that the system was closely monitored.

Oberholzer attributed last week’s poor performance and the continued implementation of load-shedding, to a number of factors, including the various necessary plans being undertaken to increase generation capacity.

He said that, over the next 12 months or so, the benefits thereof would not be realised and the country would continue to rely on an old, unreliable coal fleet that continued to deteriorate owing to inadequate capacity to undertake maintenance.

Further, Oberholzer said demand and supply were not in balance and Eskom had to run emergencies when it had capacity challenges because of this.

He indicated that Eskom had to balance the delicate situation of needing to undertake maintenance on units, but being unable to take these off the grid simultaneously.

Oberholzer said Eskom would be ramping up planned maintenance as the country goes into the summer months; however, this would still be insufficient.

Moreover, he said maintenance had not been yielding the required results and effects, with many units returning from this and still suffering breakdowns, with the poor quality of work owing to a lack of skills and requisite experience, internally and from some partner contractors.

Oberholzer said Eskom was currently dealing with this aspect and would soon communicate the actions to implement to bring in the expertise and competence where needed.

Oberholzer also noted that Eskom had already spent about R7.7-billion in the first six months, considerably over its budget and leaving it on track to overspend for the full year. “This is a tough space to be in, with no money, and needing to use emergencies because there is not enough capacity to supply for the country,” he lamented.

KOEBERG UPDATE

Following a report by News24 earlier on September 12 that a steam generator meant for the Koeberg station had been dropped in the manufacturing facility in China, Oberholzer confirmed that this did occur – but clarified that it happened about a year and a half ago.

He acknowledged that this had resulted in delays to this steam generator being delivered – it is slated ...

Government has confirmed that the procurement allocation for Bid Window Six (BW 6) of the Renewable Energy Independent Power Producer Procurement Programme (REIPPPP) has been scaled back to 4 200 MW from the 5 200 MW announced by President Cyril Ramaphosa on July 25.

The National Energy Crisis Committee announced on Sunday that the decision to proceed with a 4 200 MW request for proposals (RFP) had been decided so as to ensure that the procurement process was not delayed, given that the National Energy Regulator of South Africa (Nersa) still needed to concur with a Ministerial determination opening the way for the procurement of more solar photovoltaic (PV) capacity.

Engineering News reported previously that Nersa had invited public comment on it providing concurrence with the new Ministerial determinations allowing for the procurement of 18 791 MW of new electricity capacity catered for under the 2019 edition of the Integrated Resource Plan (IRP 2019).

The regulator initially set a deadline of September 23 for such comment, which would have been a day after the BW6 bid submission deadline of September 22, which had itself been shifted from August 11 following the announced enlargement of the round.

Nersa later confirmed an earlier September 16 deadline.

The solar PV allocation catered for under an existing determination, published in 2020, has nearly been exhausted and, absent a new determination, the IPP Office had indicated to Engineering News that the size of BW 6 might have to be reduced to 4 200 MW.

Initially, 2 600 MW was due to be procured through BW 6, but Ramaphosa announced in July that the round would be doubled as part of a series of interventions announced as part of a so-called Energy Action Plan to tackle intensifying load-shedding.

Mineral Resources and Energy Minister Gwede Mantashe subsequently delivered three proposed determinations to Nersa in line with Section 34 of the Electricity Regulation Act, covering the following capacities included in Table 5 of the IRP 2019:

14 791 MW of ‘Storage’, ‘PV’ and ‘Wind’, for the years 2024 to 2030;

3 000 MW in accordance with the heading labelled ‘Gas/Diesel’, for the years 2024 to 2027; and

1 000 MW in accordance with the heading ‘Other Distributed Generation, Co-Gen, Biomass, Landfill’, for the years 2023 and 2024.

However, in a statement the National Energy Crisis Committee said the RFP would be limited to 4 200 MW so as to avoid delaying the bidding process.

“To clarify the procurement process currently under way, due to the urgency required to resolve the electricity supply crisis, the government decided to proceed with increasing the wind allocation from 2 600 MW to 3 200 MW at this stage, in line with the Second Determination of 2020.

“Rather than delay this RFP for all requests to be approved, government opted to issue the current RFP for 4 200 MW as opposed to delaying the entire Bid Window.

“A further announcement regarding the remaining 1 000 MW of solar PV will be made following the conclusion of the Nersa process regarding the concurrence of the new determination.

“At the end of this process, we aim to be adding a total of 5 200 MW under BW 6 to the grid,” the statement reads.

It adds that the decision to proceed follows the conclusion of all required governance approvals, including Eskom’s approval, which is necessary as the State-owned utility remains the single buyer of all electricity procured by government under the REIPPPP.

Meanwhile, none of the 25 preferred projects selected under REIPPPP BW 5 have reached financial close, despite the deadline having been shifted twice to accommodate the projects.

The BW 5 projects, which were initially meant to close at the end of April, have been hampered by the slow issuance of grid connection Budget Quotes by Eskom’s Grid Access Unit, as well as major cost changes precipitated by supply-chain disruptions and the rise in the cost of components since Russia’s invasion of Ukraine.

The IPP Office told Engineerin...

The Industrial Development Corporation (IDC) believes its R14-billion green-economy project pipeline could provide the platform for a strong recovery in investment funding, following a sharp drop over the past two years.

The State-owned development finance institution disbursed only R7.2-billion during its 2022 financial year, during which funding approvals rose to R16-billion.

Although up on the R6.3-billion disbursed in the prior year, which coincided with the economic collapse associated with Covid, disbursements remain well below pre-pandemic levels and fell short last year of what is required to support South Africa’s economic recovery and reindustrialisation.

In the five years prior to Covid, the IDC disbursed at a yearly rate of about R12-billion and had an official target to lift yearly disbursements to R20-billion.

Speaking during the group’s results presentation, shareholder Minister Ebrahim Patel said disbursements remained below levels where they could make a “meaningful impact on the economy” and play a countercyclical role.

“It's precisely at the time when traction decreases in the economy that we need to see the impact of an institution like the IDC,” he said.

The pullback, Patel acknowledged, had been necessary to shore up the IDC balance sheet in a context where government’s weak fiscal position had made any recapitalisation of the organisation all but impossible.

Nevertheless, the Minister reported that a target had been set for the group to increase its direct disbursements to R20-billion during the 2023 financial year on the basis of a stronger project pipeline, as well as the tailwinds provided by strong commodity prices and regulatory reform in the electricity sector.

CEO TP Nchocho described the disbursement goal as a “stretch target” but told Engineering News that the IDC was indeed ready to ramp up its financing activities following a period of recovery and consolidation, during which it strengthened its financial position and re-established the “firepower” needed to increase its developmental impact.

The group’s capital base had increased to R109.7-billion, a 32.5% year-on-year rise, and the IDC ended the year with cash reserves of R14.8-billion and a lower gearing of 34.5% (51.4%).

In addition, its Foskor subsidiary, for which the IDC is still seeking a strategic industrial partner, narrowed its loss to R477-million during the year from R2.2-billion.

Nchocho noted that while disbursements remained depressed, approvals of R16-billion represented a 146% rise from the R6.5-billion approved in the previous year and created the basis for higher future disbursements, given that many approvals were disbursed over a multiyear timeframe.

“The transaction volumes that are coming through include some particularly large investments in infrastructure, energy, mining, in the chemicals and pharmaceuticals sector.

“So, the pipeline is there.”

BIG GREEN PUSH

The IDC was particularly bullish on prospects for green-economy investments, including in renewable energy, battery storage, new energy vehicles, green hydrogen and renewables and battery component manufacturing.

The overall project pipeline involved about 40 projects, about one-third of which were in so-called green economy projects.

The IDC already had renewable-energy generation assets worth R14-billion, mostly developed under government’s Renewable Energy Independent Power Producer Procurement Programme (REIPPPP).

It would continue to participate in REIPPPP projects but was also experiencing strong deal flow as a result of recent reforms allowing distributed generation projects below 1 00 MW to proceed without a licence. Government is in the process of lifting that cap entirely.

The IDC’s export-oriented mining and industrial clients were pursuing these generation projects partly to bolster security of supply in a context of intensifying load-shedding by Eskom, but also to improve their green credentials as several economies prepared to introduce carbon ta...

Industry organisation the South African Tyre Manufacturers Conference (SATMC), which includes Continental, Bridgestone, Goodyear and Sumitomo, has welcomed the International Trade Administration Commission’s (Itac’s) publication of provisional payments of 38.33% on unfairly traded, or dumped, passenger, truck and bus tyres imported from China for six months until March 8, 2023.

The SATMC had applied to Itac for relief against dumped imports from China in late 2021. It said on September 9 that these provisional payments would address the issue of unfairly traded tyres from China that “over many years have caused the South African Customs Union tyre industry to suffer material injury that placed the tyre industry’s future, investment opportunities and direct and indirect job creation at risk”.

"SATMC wishes to stress that the investigation that was initiated on January 31, is still ongoing. Only the preliminary phase of the investigation has been concluded and resulted in the provisional payments," the organisation said on September 9.

A preliminary report will soon be published, setting out Itac’s decision. Interested parties have 14 days from the date of publication of the preliminary report to comment in writing to Itac.

Further, the Itac investigation will continue, with its final investigation phase, during which Itac will study all interested parties’ comments and verify information that was submitted, before issuing an essential facts letter. This will be followed by Itac’s final determination that must be published by or before July 31, 2023.

Fairly traded imports at prevailing prices from countries other than China, such as Korea and Japan, will continue unaffected into the South African Customs Union.

The SATMC applied to Itac for the implementation of additional duties of between 8% and 69% on passenger, taxi, bus and truck vehicle tyres imported from China. Current import duties levied on tyres range from 25% to 30%.

Industry association the Tyre Importers Association of South Africa (TIASA) said it was disappointed by Itac’s announcement of the imposition of a blanket 38.33% provisional duty on tyres imported from China, which is on top of the import duties that currently exist of between 25% and 30%.

"TIASA believes these additional duties will have a devastating impact on motorists, public transport users and the trucking and logistics sector, and will drive up consumer inflation and the price of living, putting South Africans under further financial strain."

The 38.33% additional duty, as has now been applied by Itac, means that, from September 9, taxi operators, passenger vehicle owners and truck and logistics companies will pay about 20% more for tyres, TIASA averred.

“This decision by government is unfathomable. Duties are simply another form of tax on the consumer and on businesses, and it is clear that Itac and the Department of Trade, Industry and Competition (DTIC) have not properly considered the impact this will have on the cost of goods, transport and on inflation itself,” said TIASA chairperson Charl de Villiers.

Further, industry association the Road Freight Association (RFA) said the antidumping duty levied at 38.33% on the imported price of the tyres will increase the price of tyres and impact on the operational costs of transport.

It will drive up the price of the transportation of goods by at least 8% and, depending on the transport leg variables, this increase could be more, said RFA CEO Gavin Kelly.

"Tyres are a crucial link in the safe and efficient operation of a vehicle, and affect road safety through road holding ability, carrying weights, navigating through bad roads and ensure the driver has control in unexpected weather or traffic situations. They also affect the fuel consumption of a vehicle and the type of wear and tear that is experienced by the road surface.

"The country cannot have a situation where tyres become so expensive that fleet owners and private individuals begin to push ...

The growing demand for commodities, post-Covid-19 stimulus packages, and increased infrastructure spend in a number of markets all stimulated demand for Bell Equipment's products in the six months to end-June.

However, the bad news is that supply-chain challenges constrained sales and prevented Bell from fully capitalising on this strong demand, says CEO Leon Goosen.

These challenges related particularly to late and insufficient component supply.

The continued conflict between Russia and Ukraine also exacerbated existing supply-chain issues, with certain suppliers affected by trade restrictions.

Bell on Friday released its results for the first half of the 2022 financial year.

Goosen says the group’s manufacturing operations increased planned production in response to global market growth and a subsequent strong order book, but noted that continued supply-chain challenges delayed invoicing, leading to an increase in inventory and borrowings in the period under review.

Inventory was up by more than R1-billion in the period, to R4.74-billion.

“It is anticipated that inventory will reduce as products are shipped from the manufacturing plants and as greater post-Covid normality returns to both the supply and logistics chains,” says Goosen.

In the meantime, additional funding lines are being put in place to fund the increase in working capital required to meet the higher production plan and sales outlook, as well as to absorb the effects of any further supply-chain disruptions.

Goosen also notes that raw material, component and logistics cost increases are unprecedented – “double-digit in many cases” – and that the company has been forced to pass these extra costs on to customers.

Locally, Bell is refocusing and growing the traditional Bell/Matriarch forestry and agriculture product lines, along with the JCB Agriculture range, by establishing a wider local dealer footprint in South Africa.

Looking ahead, Goosen says that while there are signs of economic slowdown in some markets, existing stimulus packages continue to drive demand for Bell products in most international regions.

He says the group has healthy order books in all regions for the remainder of the 2022 financial year. He expects global demand for Bell Equipment’s products to continue to increase.

Mining activity in particular has exceeded expectations, leading to higher demand and a better-than-anticipated result for this division.

However, the construction industry outlook for South Africa remains tepid as the country grapples with low infrastructure spending in a weak economy.

Demand in the US remains at much higher levels than the group has seen for some time and additional product to meet this demand is planned.

Going forward, Bell plans to expand its manufacturing footprint in the northern hemisphere.

This will improve responsiveness and efficiencies as more of the group’s articulated dump trucks will be produced closer to suppliers, as well as the markets in which they are largely sold.

Capacity created at the Richards Bay factory in South Africa will be utilised by additional product that will be introduced in the southern hemisphere over the next few years.

To this end, underground mining equipment and contract manufacturing have been identified as possible diversification opportunities for the Richards Bay manufacturing facility.

Goosen says Bell currently has two products in the underground mining sector, but that the group wants to increase this offering.

“We are not strong in underground mining, but we want to be. We are in the process of developing new products.”

Contract manufacturing opportunities at the Richards Bay plant can include anything from trucks to heavy industrial products, such as railway bogies.

Bell reported on Friday that revenue for the six months to end-June 2022 was R4.2-billion, up from R3.84-billion in the same period last year.

Profit for the period was R210-million, up from R176-million.

South Africa has fallen from its position of 93 last year in the Economic Freedom of the World Annual Report, released by the Free Market Foundation (FMF) and Canada’s Fraser Institute, to 99 this year.

This marks a further fall from the country’s best ranking of forty-seventh in 2000.

FMF director Eustace Davie attributes South Africa’s worsening ranking among 165 jurisdictions monitored, to the deterioration of economic activity in the country, including its high unemployment rate.

Fraser Institute resident fellow and coordinator of the Economic Freedom Network Fred McMahon adds that, when jurisdictions increase taxes and regulations, the public become less economically free, which means even slower economic growth and less investment.

In particular, South Africa has declined from a score of 5.99 to 6.14 in terms of size of government, while the legal system and property rights score improved to 5.95 from 5.09 the previous year.

On the access to sound money aspect, South Africa declined from a score of 8.21 to 8.24, and from 5.8 to 6.6 in terms of freedom to trade internationally.

South Africa’s score on regulation of credit, labour and business has also declined to 6.78 this year, from 7.16 in the prior year.

On the other side of the spectrum, Hong Kong and Singapore have maintained their rankings atop the index, at first and second place, respectively, while Switzerland, New Zealand, Denmark, Australia, the US, Estonia, Mauritius and Ireland make up the remainder of the top ten.

The Economic Freedom report was launched in 1996 to measure the ability of individuals to make their own economic decisions. FMF analyses several indicators such as regulation, size of government, property rights, government spending and taxation to produce its findings.

This year’s report captures 2020 data and, therefore, the effect of Covid-19-related restrictions.

Among the ten lowest-rated countries are the Democratic Republic of Congo, Algeria, Congo-Brazzaville, Iran, Libya, Argentina, Syrian Arab Republic, Zimbabwe, Sudan and Venezuela.

This year, South Africa ranks lower than its counterpart India, at ninetieth, but better than other counterparts Russia, which ranked ninety-fourth, Brazil, ranking at 114 and China, at 116.

Moreover, McMahon says, where people are free to pursue their own opportunities and choices, they lead more prosperous, longer and healthier lives, with more political and civil liberties to boot.

FMF associate Neil Emerick says that, while South Africa is a lively destination for investment, its large government, closed economy and overregulation are holding it back from realising this potential.

Business and macroeconomic analyst Phumlani Majozi says South Africa’s government continues to believe it can solve the country’s problems by spending more. This while State-owned entities keep receiving billions of rands of bailouts.

“We need government intervention in health, transport and energy infrastructure development, and for it to allow for the conducting of business easily and competitively,” he notes.

Davie concludes that there is no reason why South Africans should not be as economically free or even more free than people living in Estonia, Mauritius or Ireland.

“The people of South Africa should demand that their country set out to become one of the freest in the world, just as Mauritians set out to do and achieved in 20 years.”