Category: Regional Integration

Is the Corona Virus #COVID19 HERE to Stay & Future of Cash?

Is the Corona Virus #COVID19 HERE to Stay & Future of Cash?

NO ONE is sure and there has not been much scientific discourse around that aspect as the world is still fighting to contain its spread and avert a Pandemic ensuing from it.

President Donald Trump

The president of the United states of America, Donald Trump is of the view that it will soon go away with the dawning of spring and the warming of the weather. To support his assertion some scientists have also alluded to the same by stating / speculating that the new coronavirus is similar to influenza and some other viruses. Therefore, it could dissipate once temperatures rise and humidity increases. President has been consistent in his approach since his tweet on the same on 7 February 2020 and repeated the same during his trip to India 25 February 2020.

That predisposition could soon be a catastrophic gamble considering that the #Coronavirus #COVID19 is alive and kicking in Australia where the temperatures are more like what Trump and company are hoping for. April 2020 is not very far off and we will surely tell if the President of the United States of America took a gamble or not.

United States of America to Fund Research into #COVID Vaccine

Contrary to the President’s public utterances, the White House Officials announced 24 February 2020 that they are preparing to ask for US$2.5 Billion from Congress to fight the Corona Virus. Of that US1.0 Billion was going to be set aside to develop a #COVID19 Vaccine. This shows the pragmatic approach that the officials are taking as opposed to the untested and cavalier approach by the Head of State and Government.

What is the future of Cash Transactions World Wide post #COVID19?

The country at the epicentre of the fight against #COVID19 is the most populous country in the World, The Peoples Republic of China. It is also the country with probably the highest amount of cash notes circulating in any company in the world. To curb the transmission of Corona Virus #COVID19, the Central Bank and its Banks in China have been disinfecting / laundering all cash to ensure there is no transmission of the virus through contact.

What does this move spell for regions like sub-Saharan Africa whose markets are predominantly cash sales driven through physical notes? Does it mean we are about to see a boom in careless and cashless transactions in these economies as people prepare for this current viral attack and possibly new ones. This is the region that is also periodically visited by virus attacks like ebola and others that are influenza related.

This is a new chapter in financial intermediation and we are yet to see if the African Tech Startup scene will rise to the occasion together with the region’s Central Banks. Most importantly will the political will be there to deal with such a paradigm shift? The biggest gain will be unintended formalisation of economies and possibly better fiscal collections and government spend.

Tjiyapo Velempini – @velempini,

The South African Power Conundrum

The South African Power Conundrum

What does the future hold for Eskom Holdings?

Conflicting Signals from the same Cabinet

The South African Government pronounced itself during the just ended Mining Indaba 2020 through the Ministry of Mineral Resources and Energy (Honourable Minister Gwede Mantashe); that the Government was now looking at the creation of a separate entity to spearhead New Power Generation projects / capability. From the tone it would seem like the Government is capitulating to the public sentiment that Eskom should be left intact. However, another Minister in the Ministry of Public Enterprises Honourable Minister Pravin Gordhan was stating the the Eskom Transmission Business was going to be a separate and independent unit by the end of the Month, meaning February 2020.

Is the Sunset of the MIGHTY ESKOM NIGH? - Pic (The Citizen)

These are very conflicting signals from two senior members of President Cyril Ramaphosa’s Cabinet. This lack of cohesion in public discourse and potentially different schools of thought cohabitating within one Cabinet; unit spells doom for any investors looking at investing in South Africa and by extension Southern Africa. Southern Africa is affected as it is heavily reliant on the Giant in South Africa (Eskom) for reliable and firm power. That is why the top destination countries for 2020 in Africa are not in Southern Africa.

The Heads of States in Southern and East Africa that are dependent on the Southern African Power Pool (SAPP) must start taking a keen interest on the issue as it more that just a sovereign issue; but a regional integration pain point. This also spells out the need to relook at the regions Power Strategy at country and Regional level in terms of the Agenda 2063 as spelt out by the African Union and the respective agendas look at a shorter time horizon of 2030.

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