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South African Business 2019 edition

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The 2019 edition of South African Business is the seventh edition of this annual guide to business and investment in South Africa. Regular pages cover all the main economic sectors of the South African economy and give a snapshot of each of the country’s provincial economies. Feature articles on topical issues such as Special Economic Zones and African trade provide unique insights, together with comprehensive overviews of critical economic sectors. Other special features focus on the exciting new possibilities in renewable energy, airports as engines of regional growth and the maritime sector as an entirely new prospect for South African entrepreneurs and businesses. South African Business is complemented by nine regional publications covering the business and investment environment in each of South Africa’s provinces. The e-book editions can be viewed at www.globalafricanetwork.com

OVERVIEW Water

OVERVIEW Water Restructured water boards have greater responsibilities. SECTOR INSIGHT Companies and households are focussed on water saving like never before. • An agency has been created to help municipalities deliver water. A new organisation has been formed to help municipalities deliver services. Research has shown that many municipalities, which in South Africa are the main delivery agent of water and waste-water services, are either functioning very badly or barely functioning at all. According to Water Wheel magazine, 37% of water delivered to the nation’s municipalities is lost, at a cost of R7-billion per year. This presents an opportunity for innovative companies to provide better pipes and smart meters. The Municipal Infrastructure Support Agency (MISA) falls under the Ministry for Cooperative Governance and Traditional Affairs and will assist municipalities to plan for, provide and maintain infrastructure. The first action of MISA was to commission 81 engineers and town planners to get to work in areas that need the most help. A study jointly commissioned by the Water Research Commission and the South African Local Government Association (SALGA) found that the country’s four-in-a-million ratio of engineers is a long way from the required 50-per-million. One response at national level was the importation of Cuban engineers to assist in the short term. Another response to the municipal problem is a new national strategy which gives a bigger role to well-resourced water boards such as Umgeni Water and Sedibeng Water. Rand Water has expanded its original footprint and now serves an area which includes Gauteng, and parts of Limpopo, North West, Mpumalanga and the Free State. The national Minister of Water and Sanitation is the shareholder, representing the government of South Africa. In terms of the National Water Resource Strategy, catchment area management agencies have been established to oversee water resource management on a regional basis. The Imkomati-Usuthu Catchment Management Agency covers Mpumalanga, parts of Limpopo and part of the Kingdom of Swaziland. Another example of a CMA is the Breede-Gouritz Catchment Management Agency in the Western Cape. The National Water Resource Strategy takes into account groundwater to a far greater degree than previous plans. Extracting groundwater takes skill and money, but with droughts becoming commonplace it is likely to become a much higher priority in water planning. SOUTH AFRICAN BUSINESS 2019 82

Innovation A long drought was finally broken in most of the country in late 2016, but the Western Cape continued to experience severe shortages until mid-2018. Tenders for desalination in various guises (including barges in Cape Town harbour) were issued and there is no doubt that a new phase in water management has begun. Water harvesting (including installing tanks to collect rain water from roofs) has not been comprehensively exploited. Innovators and investors in the sector have a lot of scope to develop products and systems to help South Africa harvest rain water, store water and reduce consumption. The Danish government has an agreement to help the South African government with water management and water efficiency. Companies such as smart-meter specialists Kamstrup are already active in the country. A Western Cape company has developed a mobile unit for the South African National Defence Force that can produce drinkable water from any source, including sea water. Malutsa’s Blesbok Project has the potential to be converted to civilian use in situations such as refugee camps or remote and dry areas which services cannot reach. The National Department of Science and Technology is piloting a Point-of-Use (POU) project in Malatane village in Limpopo, Eastern Cape and North West. The project is part of the department’s Innovation Partnership for Rural Development Programme (IPRDP), which is supported by the European Union. Large projects The distribution of South Africa’s water means that large quantities must be piped to urban concentrations. The Vaal basin, which serves the most populated and industrialised part of the country including Johannesburg, receives water from seven inter-basin transfer schemes. In 2017/18 the National Department of Water and Sanitation spent R12.5-billion on dams, water transfer schemes and bulk distribution. The completion of the De Hoop Dam in eastern Limpopo means that people living in small municipalities can now expect bulk water delivery. The Trans Caldeon Tunnel Authority (TCTA) is responsible ONLINE RESOURCES National Department of Water and Sanitation: www.dwa.gov.za South African Water Research Commission: www.wrc.org.za Trans Caledon Tunnel Authority: www.tcta.co.za Umzimvubu Catchment Partnership Programme: www. umzimvubu.org Water Institute of South Africa: www.wisa.org.za OVERVIEW for bulk water supplies. The De Hoop Dam is the centrepiece in the large Olifants River Water Resource Development Project. In KwaZulu-Natal, the first phase of the Spring Grove Dam in the Mooi River area has been completed on schedule and has increased water supplies in the Umgeni River catchment area. A new reservoir (Waterloo) near the King Shaka International Airport, and serving this northern area, has been constructed as part of the master plan that will see water delivered to this reservoir from the Northern Aqueduct Augmentation Project. The Western Aqueduct project (valued at R864-million) and the associated Northern Aqueduct Augmentation Project will inject water into the rapidly developing area north of Durban. The Tugela Bulk Water Scheme (valued at R1.4-billion) will supply water to KwaZulu- Natal’s North Coast. A water supply and hydropower project is planned on the Umzimvubu River in the Eastern Cape, under the control of the National Department of Water and Sanitation. The Umzimvubu catchment and river system stretches for over 200km from its source in the Maloti‐Drakensberg watershed on the Lesotho escarpment to Port St Johns. Amatola Water is a leading water provider in the Eastern Cape. The body manages bulk water infrastructure across 50 000km², encompassing the district municipalities of Chris Hani and Amathole and portions of other municipal areas. 83 SOUTH AFRICAN BUSINESS 2019

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