News: Former ANC Treasurer Mathews Phosa has warned Chancellor House, the ruling party’s investment arm, to stay away from government tenders. EWN reports that Phosa made this statement following the scandal involving Hitachi, a Tokyo-based company, which was awarded a contract to build boilers for the Medupi power station. Hitachi was fined $19 million (about R268 million) by the US Securities and Exchange Commission (SEC) after claims that it inaccurately recorded improper payments to the ANC. EWN reports that Phosa called these types of state transactions unethical.
News: Debt is weighing down South Africans. The country owes R1,63 trillion to financial institutions, according to a National Credit Regulator (NCR) second-quarter report. Most of the debt is a result of mortgages, which account for R857 billion, followed by asset-backed credit at R357 billion. Business Day reports that retailers are owed R38,37 billion, non-bank vehicle financiers’ are to receive R36,69 million and other credit providers are owed R45,11 billion.The number of people with bad credit increased by 124 000 to 10,5 million in the second quarter. As a result, banks are more cautious about lending money. The number of people who applied for credit increased by 16%, but more than half of the applications were unsuccessful.
News: Eskom says the 30 000 workers planning to embark on a strike will not affect the country’s power supply. SABC Online reports that the power utility’s Spokesperson, Khulu Phasiwe, said that many of the power stations still have about 30 days of coal, so there will not be any major interruptions. Yesterday the National Union of Mineworkers said it would give coal companies a 48-hour strike notice after wage talks collapsed. The union was demanding a 50% wage hike, but scaled this back to 13%. The Chamber of Mines says it has raised its offer to 8,5 % for lowest-paid workers. Eskom has consistently struggled to meet the country’s power demands, leading to a 1,3% contraction in that country’s economy in the second quarter.