Thinking behind Billiton deal leaves SA scratching

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Eskom does seem to have an irritating habit of automatically and emphatically saying “no” to anyone who asks it for information. Now more than four years, and presumably millions of rands of legal fees, later it will have to disclose how much BHP Billiton is paying for electricity at its two massive aluminium smelters. And for that we must all thank Media24.

Assuming Eskom doesn’t somehow wiggle out of publicising the information, the details behind the pricing of electricity supplies to BHP Billiton’s smelters is probably going to make for grim reading for consumers who face having to deal with crippling and increasing electricity costs.

While it is to be expected that we will all become indignant about the cheapness and duration of BHP Billiton’s electricity deals it is probably worth recalling that until about 2005, South Africans weren’t as nervous about electricity supply and costs as we are currently. The severe outages in 2007 and 2008 changed everything.

But in the 1990s, when it appears these contracts were entered into, electricity cost and supply were not concerns. Back then young Mick Davies was the finance director of Eskom, where he cut an impressive figure before going on to join Brian Gilbertson at Gencor, which morphed into BHP Billiton. More recently Davies was head of Xstrata before butting heads with his former Wits colleague Ivan Glasenberg of Glencore fame.

It would be nice to get some sense of the thinking behind the BHP Billiton/Eskom contracts. While few people would have anticipated the extent to which China changed the world from 2001, did the executives at Eskom have no inkling of the consequences of having to supply electricity to all South Africans after 1994?

And given that BHP Billiton was shipping in alumina and shipping out aluminium how did the ANC government reckon we could offer cheap electricity as a long-term competitive advantage? page 19

 

Rossouw memorial

A memorial dedication to the late Mandy Rossouw, a former parliamentary journalist and most recently a political reporter with City Press, was held at Parliament yesterday. Rossouw was a special person, who probably would one day have become an editor of one of our esteemed publications.

But in her short life – she died at 33 of a heart attack – she wrote thousands of stories for newspapers, radio and digital news websites. Somehow she also found the time to author – or co-author – a number of books, including Mangaung: Kings and Kingmakers. It is the story of President Jacob Zuma and the current political elite.

Among the other books she co-authored were The Year in Quotes 2010 and Come Again? Quotes from the Famous, the Infamous and the Ordinary. But at her memorial dedication arranged by the Parliamentary Press Gallery yesterday, the focus fell on The World According to Julius Malema, published in 2009, which she wrote with Max du Preez before Malema got the boot as the ANC Youth League president. Apart from the parallels the book has with John Irving’s The World According to Gaap, some of the quotes from that book provide a greater understanding of Malema and Zuma, but also about our current politics four years later.

Among them she quotes Malema on Zuma’s education: “Zuma was taught by people on the ground. He is the most educated president. Economics is simple – put bread on the table.”

On politicians Malema said: “Politicians are the easiest to replace… we will move forward and they will carry on with the programmes which are there.”

On a two-thirds majority: “We are tired of a two-thirds majority. Our aim is a three-thirds’ majority.”

On being a decoy, Malema said: “I was the decoy. While Helen Zille was calling me names, Jacob Zuma was sprinting to the Union Buildings.”

On Nando’s, Malema said: “I don’t know what is happening with Nando’s. We are running this country and we cannot be concerned about chickens.”

On the ANC Youth League: “We are in a political laboratory; never blame us if we make mistakes, we are (just) learning.”

It is a case of the more things change, the more things stay the same.

 

Cape Town airport

Although Cape Town lagged behind Johannesburg and Durban in developing an “aerotropolis” or mini-city on vacant land surrounding its international airport, some commercial development had taken place and about half the airport’s income came from that and from the enlarged shopping and restaurant facilities in the airport itself, general manager Deon Cloete told members of the Cape Town Press Club recently.

He said some of the families living in informal accommodation on the airport perimeter had been housed elsewhere, releasing land for development or inclusion in the airport and this process was continuing.

There were already plans to develop the vacant land on the eastern precinct as a commercial zone, corresponding to that on its western side for developments such as hotels, filling stations and warehouses. The need for a second runway had been recognised as the existing one was fully used at certain times of the day. Increasing numbers of people were coming to the airport to shop and patronise the restaurants.

Cloete first drew the attention of the provincial government a year ago to the possibilities of an aerotropolis with residential, industrial and commercial components, in line with an international trend to attract new business and direct foreign investment to the vicinity of major airports, and it has shown interest.

He pointed out that the airport already had some export-orientated industrial development in its immediate surroundings and was located between the port of Cape Town and a new export processing zone at Saldanha. It is midway between the developing countries of the south and east, ideally positioned for the growth of international trade and tourism.

 

Edited by Banele Ginindza. Contributions from Ann Crotty, Donwald Pressly and Audrey D’Angelo.


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