----- Original Message ----- From: "Robert Weissman" <rob at essential.org> To: "stop-imf at lists.essential.org" <stop-imf at venice.essential.org> Sent: Friday, November 23, 2001 4:51 PM Subject: [stop-imf] WPost on SA electric privatization (Nov 6)
> For South Africa's Poor, a New Power Struggle
>
> By Jon Jeter
> Washington Post Foreign Service
> Tuesday, November 6, 2001; Page A01
>
> SOWETO, South Africa -- When she could no longer
> bear the darkness or the cold that settles into her
> arthritic knees or the thought of sacrificing
> another piece of
> furniture for firewood, Agnes Mohapi cursed the
> powers that had cut off her electricity. Then she
> summoned a neighborhood service to illegally
> reconnect it.
>
> Soon, bootleg technicians from the Soweto
> Electricity Crisis Committee (SECC) arrived in pairs
> at the intersection of Maseka and Moema streets.
> Asking for
> nothing in return, they used pliers, a penknife and
> a snip here and a splice there to return light to
> the dusty, treeless corner.
>
> "We shouldn't have to resort to this," Mohapi, 58,
> said as she stood cross-armed and remorseless in
> front of her home as the repairmen hot-wired her
> electricity.
> Nothing, she said, could compare to life under
> apartheid, the system of racial separation that
> herded blacks into poor townships such as Soweto.
> But for all its
> wretchedness, apartheid never did this: It did not
> lay her off from her job, jack up her utility bill,
> then disconnect her service when she inevitably
> could not pay.
>
> "Privatization did that," she said, her cadence
> quickening in disgust. "And all of this
> globalization garbage our new black government has
> forced upon us has done
> nothing but make things worse. . . . But we will
> unite and we will fight this government with the
> same fury that we fought the whites in their day."
>
> This is South Africa's new revolution. Seven years
> after voters of all races went to the polls for the
> first time, ending 46 years of apartheid and white
> rule, churches,
> labor unions, community activists and the poor in
> all-black townships are dusting off the protest
> machinery that was the engine of their liberation
> struggle. What most
> provokes South Africans' defiance today are what
> they see as injustices unleashed on this developing
> nation by the free-market economic policies of the
> popularly
> elected, black-led governing party, the African
> National Congress.
>
> Materially, life here has only gotten worse since
> 1994 as the ANC has pursued a course of piecemeal
> privatization of state industries, whittling of
> import taxes and
> loosening of controls on foreign exchange. The
> policies have expanded opportunities for foreign
> investors but so far have deepened the poverty
> inherited from
> apartheid's segregationist policies.
>
> With domestic industries more vulnerable to foreign
> competition and the restructuring of public
> enterprises, the most industrialized country in
> sub-Saharan Africa has
> lost nearly 500,000 jobs since 1993, leaving a third
> of the workforce unemployed. The poorest 15 million
> South Africans have had their annual incomes shrink
> by
> nearly a fifth of what they were before apartheid's
> collapse.
>
> The ANC's top officials, many of whom were initially
> Marxists, say their economic policies aim to remedy
> the imbalances of the past, which included
> protectionist
> trade policies and concentration of wealth in the
> hands of a relative few. To redistribute wealth, ANC
> officials say, they must first expand it, and they
> say only the
> global market and foreign cash can ultimately do
> that, albeit not without some growing pains as the
> economy adjusts.
>
> Increasingly, this country of 44 million people is
> running out of patience as it endures a financial
> crisis that statistically outstrips the Great
> Depression. At the same
> time, costs of such basic needs as housing,
> electricity and water are soaring.
>
> "We did not give up our lives and the lives of our
> children only to let this brazen capitalist system
> exploit us even more," said Shadrack Motau, an SECC
> board
> member.
>
> In South Africa, the most despised acronym is
> arguably not HIV, the AIDS virus that infects nearly
> a quarter of the adult population, but GEAR, the
> ANC's
> economic package -- Growth, Employment and
> Redistribution -- which opens the door to global
> trade.
>
> Hoping to generate revenue, streamline a bloated
> bureaucracy and extend service to blacks ignored by
> apartheid, the ANC announced six years ago that the
> government would sell public enterprises from the
> state-run airlines and the phone company to Eskom,
> the acronym for the public electricity commission.
> With
> encouragement from institutions such as the World
> Bank and International Monetary Fund, the government
> has so far auctioned off only small portions, while
> restructuring the public franchises into profit
> centers to showcase their attractiveness to
> potential investors.
>
> The alienation felt by many poor blacks from this
> march to privatization has bred street rallies
> calling for a revival of "the spirit of '76" -- a
> reference to the year of the
> Soweto riots, which gave the anti-apartheid campaign
> its second wind.
>
> Virtually every week, thousands of demonstrators and
> unionized workers rally in the streets to denounce
> both GEAR and the ANC. Grass-roots organizations in
> Durban have begun moving evicted families back into
> their homes, sometimes only minutes after
> authorities have piled their household goods on the
> streets and
> bolted the doors. Unemployed plumbers in Cape Town
> reconnect their neighbors' water supply when it has
> been shut off because of nonpayment.
>
> "There's definitely been a revival of the struggle
> mentality," said Bongani Lubisi, 28, one of scores
> of jobless volunteers who roam Soweto each day
> reconnecting
> electrical service. "We thought that when we got rid
> of the old government that our black government
> would take care of us. But instead the capitalists
> are getting
> richer while the working people lose their jobs and
> can't even meet their basic needs."
>
> For all its anti-communist fervor, the apartheid
> government shielded South Africa's domestic
> industries from foreign competition with policies
> that included stiff
> controls on foreign capital, heavy state subsidies
> and tariffs on imported goods. When blacks refused
> to pay rent and utilities as part of township-wide
> boycotts, the
> apartheid government did not evict them or shut off
> their services for fear of sparking riots.
>
> Jacob Maroga, executive director of distribution at
> Eskom, said that Soweto's electricity problems
> started when the boycotts of the 1980s bankrupted
> the
> apartheid-controlled municipal government that
> purchased electricity and resold it to residents.
>
> When Eskom began handling the accounts directly, it
> spent about $75 million in capital improvements and
> wrote off nearly $37.5 million in household debts.
> But in
> its preparations to sell the public utility, Eskom
> has focused on demonstrating its profitability to
> investors, following the World Bank's prescriptions
> for "cost
> recovery" in which the price for each kilowatt of
> electricity is set according to how much the utility
> spends to provide it.
>
> That meant increasing costs by as much as 400
> percent for some residents in Soweto, who for years
> were charged a flat rate for electricity.
>
> "The idea is that we would do all [the improvements]
> and then the residents would start living up to
> their commitments. But we still recover only about
> 50 to 55
> percent of the costs for the electricity we sell,"
> Maroga said.
>
> "There are clearly customers who don't have the
> capacity to pay," Maroga said. "But there is also
> this culture of nonpayment in Soweto where customers
> can afford
> to pay but they prioritize other consumptive
> spending. We need to deal with that."
>
> In a place where median household income is less
> than $100 a month, 90 percent of all Soweto
> households with electricity are behind in their
> payments, according to
> a university survey. Sixty-one percent have had
> their service shut off within a 12-month period. In
> a community of nearly 1.5 million people, Eskom cuts
> off service
> to about 20,000 delinquent customers each month.
>
> "This culture of nonpayment that people say exists
> in Soweto," said Virginia Setshedi, an SECC board
> member and law student, "it's only because people
> don't have
> money to pay."
>
> Because Eskom sells electricity at discounted bulk
> rates, affluent municipalities in mostly white
> suburbs buy electricity and resell it to customers
> for roughly 30
> percent less than what it costs Soweto's consumers.
> For the biggest users of Eskom's electricity --
> industrial sites such as steel plants and coal mines
> -- the rate for
> each kilowatt is roughly one-tenth the rate for a
> household in Soweto.
>
> That inequity drove a coalition of unreconstructed
> communists, retirees and college students to create
> the SECC nearly a year ago. Its chairman, Trevor
> Ngwane, a
> former ANC municipal council member, recruited a
> friend, a laid-off Eskom repairman, to train
> volunteers how to reconnect a power supply.
>
> Since then, Operation Khanyisa -- which means "to
> light" in the Zulu language commonly spoken here --
> has unlawfully restored electricity to about 3,000
> homes.
>
> "We're getting about 50 calls each day from the
> community," Setshedi said. "We don't ask why or when
> the people were cut off, we just switch them back
> on.
> Everyone should have electricity."
>
> To combat the illegal connections and the SECC's
> growing celebrity, Eskom officials have published
> full-page ads in the Sowetan daily newspaper,
> warning readers
> that 10 South Africans -- mostly children -- were
> killed last year by exposed live wires. But SECC
> officials say that none of those fatalities occurred
> in Soweto,
> where volunteer technicians are trained to wrap live
> wires in plastic bags.
>
> Patrick Bond, a business professor at the University
> of the Witwatersand and co-director of the Municipal
> Services Project, acknowledges that it is expensive
> to
> provide electricity to the poor, who use little
> electricity and are unable to buy it in bulk through
> their municipality, which results in duplicate costs
> for equipment,
> administration and labor.
>
> But he said Eskom could largely resolve the debt
> problem in Soweto by charging big industries a few
> cents more for each kilowatt of electricity,
> subsidizing a
> cheaper flat rate for poor customers.
>
> "Eskom has a rate structure that economically makes
> sense," Bond said. "But socially it makes no sense.
> Their structure is good for the northern
> suburbanites, but
> we'd like to see a structure that is good for
> everyone. That means smaller profit margins in the
> short term but a healthier society in the long
> term."
>
> Lubisi and another SECC repairman take Bond's
> argument to the street. They arrived one recent
> morning at the Maseka and Moema intersection flanked
> by two
> recruits.
>
> "Red and white are used as live wires and they are
> very dangerous," Lubisi said, showing the wires to
> the trainees as a crowd gathered.
>
> James Buthelezi has lived in this house on Maseka
> Street for as long as he can remember, and this was
> the first time the electricity had been cut off.
> Twenty-eight
> people live in this five-room house and a tool
> shed-sized room in the back yard.
>
> No one has worked in months and the family survives
> on Buthelezi's mother's pension, less than $125 a
> month. Their unpaid bill is more than $3,000. "When
> they
> came to cut off our electricity, we begged them not
> to," said Buthelezi, 58. "We told them that we had
> babies and elderly people inside. They didn't even
> pause."
>
> The SECC's members have tried to talk to
> Johannesburg's mayor about the hardships endured by
> families like Buthelezi's, but he has repeatedly
> given them the slip.
> In June, more than 20 angry residents marched to the
> mayor's home but again he ducked them.
>
> Unable to cut off his electricity, they disconnected
> his water.
>
> ©
> 2001 The Washington Post Company
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