By Neil Farmer
I originally worked in South Africa more than 30 years ago and returned there last year and reported on an economy I felt had great potential despite its challenges. I also said there were grounds for optimism.
After another recent visit, I can say those comments have been vindicated. Over the last few months, the country has witnessed the resignation of President Jacob Zuma and the election of ANC president Cyril Ramaphosa as the new head of state. The last day of President Zuma was said to be one of the most extraordinary in the country’s history. After his removal from office, I sensed a feeling of greater optimism amongst many people. Government debt had risen to 53% of GDP. This may not seem high compared to the UK’s figure of 95% of GDP, but South Africa’s high interest rates means it has to spend a larger amount of GDP to service its debt. The Economist newspaper estimated it would have to pay more than $12.5 billion to service its debt in 2017, 3.5% of GDP.
The Jacob Zuma presidency and the allegations of corruption have left many disillusioned with the whole political system.
Whilst I was in Cape Town and the Western Cape, the matter on everyone’s lips and in the media was the chronic water shortage. As the dam levels got lower, the question on everyone’s lips was when the water supply would finally run out. Thankfully the City of Cape Town confirmed in April that ‘Day Zero’ would no longer occur in 2018. Introducing stringent water measures, along with welcome rainfall, have alleviated the problem but restrictions are still in place. Cape Town’s executive mayor said residents can expect a 27% increase in water tariffs this year.
The ingenuity of leading companies in the industry should be applauded. Whilst I was in Cape Town, South African Breweries said they would spend Rand 24 million filling 12 million quart beer bottles with pasteurised water from its Newlands brewery’s spring and distributing them to 300 shops in Cape Town, if ‘Day Zero’ arrives. The company said water would be free but customers would have to pay 90 cents returnable deposit for each bottle, which I doubt would cause anyone any concerns or issues.
With a heat wave ongoing whilst I was in Cape Town, I was more than happy to drink bottled mineral water produced by Verve, a premium purified mineral water company. The business was established more than 15 years ago and has grown into a national entity with three mineral water sources, providing good quality product. Verve Mineral Water offers bottles in PET and glass. It considers itself a leader in the country’s returnable glass bottle industry. Verve utilises the reverse osmosis process, regarded by many as the most technologically advanced purifying system in the world and used by NASA and the US army.
The process allows the removal of particles as small as ions from a solution. Reverse osmosis uses a membrane that is semi-permeable, allowing the water that is being purified to pass through it, while rejecting the contaminants that remain. The result is pure water with no contaminants, impurities, chlorides, fluorides or hormones. The water is available in leading hotels and restaurants in Western Cape, Gauteng and Kwazulu Natal. I also applaud the company for its attractive glass and PET bottles and its decision not to use plastic labels. This is not only done as an environmental consideration but also because Verve has chosen to use direct print technologies, which reproduce any logo or design in an attractive way on the bottle.
I’m now expecting a better performance for South Africa economically, with further innovations in its packaging industry, which continues to develop world class solutions.