ZA Update: Increased focus on developing infrastructure following presidential address

Rise in Fuel and Energy Costs Expected as Russia - Ukraine Tensions Increase

The sanctions imposed on Russia have sparked a rise in the global price of oil. It is being reported that oil is set to surpass the $130 per barrel mark, which will lead to knock-on price increases in the supply chain with fuel costs expected to rise further as a result.

The price of gas and electricity are also set to increase on the back of the current situation, with Russia accounting for more than 30% of Europe's gas resources whilst pipelines travelling through Ukraine carry 8% of supply. The ramifications of Europe's dependence on gas exported from the two nations is set to be global, as many countries look to cut ties with Russia and Russian-owned organisations.

State of the National Address Highlights ZA Supply Chain Flaws

Cyril Ramaphosa’s State of the National Address has outlined concerns within South Africa’s infrastructure in relation to its economic and agricultural growth. In the SoNA, Ramaphosa spoke of the country’s inefficient ports and railways as a barrier to investment for companies, a factor stunting South Africa’s economic growth. Ramaphosa put an emphasis on the fact that South Africa’s agricultural sector cannot grow without improvement primarily to the country’s ports, which are performing some way behind many other nations both on the African continent and worldwide. 

When speaking of the government’s plans and focus on improving South Africa’s supply chain infrastructure, he said “The key task of the government is to create the conditions that will enable the private sector, both big and small, to emerge, to grow, to access new markets, to create new products, and to hire more employees.”.

Trucking Protests Continue on South African Roads

Further protests have been taking place across South Africa with the aim of addressing grievances predominantly related to foreign drivers being allowed to work in South Africa, proposed wage increases and issues surrounding forced vaccinations. The protests have seen roads including the N3 and N12 blocked by trucks, however the All Truck Drivers Forum and Allied South Africa have distanced themselves from the illegal blocks after previously proposing the ‘national stayaway’ for truck drivers, stating that the organisation in no way instructed drivers to block the roads.

A further list of the organisation’s demands can be seen below:

• Truck driving in the freight industry must be reserved only for South Africans
• Zimbabwean permits’ grace period must be abolished
• No foreigner must be allowed to register with the NBCRFLI
• No work permits must be issued for non-skilled jobs
• A 15% wage increment under the campaign Living Wage 2022
• Drivecam (inside cameras) must be removed
• No forced vaccinations
• No company should operate in South Africa without being a member of the NBCRFLI

Toll Fee Increases

The increase in fees for using toll roads took effect on 1st March and applies to toll roads including N1, N2 and N3. The tariffs, used to maintain and improve South Africa's roads, have seen an increase in line with the country's Consumer Price Index (CPI), with the CPI percentage applied being 5%.

ZA Cyber Crime Now Fastest-Growing

A recent report by Surfshark has indicated that South Africa has seen a 277% year on year increase in internet breaches, making it the fastest growing of the top 10 most online-targeted countries. The country now sits 6th in the list with 51 victims per 1 million users. Cyber attacks and data breaches are a growing concern for businesses worldwide, boosting the importance of cyber security in online operations.

Woodland's Dedicated South Africa Team

Our dedicated South Africa team is on hand to support you and keep your supply chain moving. If you would like more information regarding South Africa supply chains, contact the team here.