Sunday, January 27, 2008

Bling Impossible to Find in the Dark

High end jewelry is the end product borne from corporations seeking to send low paid workers and miners in to go find the dangerous and perilous gems and minerals hidden deep within the Earth. It is next to impossible to do that if the miners are working without electrical energy because the South African government is out of power - mainly electrical. Gold and platinum mining came to an abrupt blackout in South Africa even while erstwhile tourists were stranded dangling atop Table Mountain in cable cars chugging uphill from Cape Town. Paved in darkness are South Africa's neighbors, as they all rely on Eksom as their main provider of energy.
Cape Town & Table Mountain
Eskom described the electricity supply
position as an "emergency or force
majeure," which will likely last from two to four weeks.

The utility has asked its 138 biggest
industrial customers to reduce their electricity usage to the minimum level possible.

"The impact extends beyond the mining sector, which now only contributes around 5.5% to GDP, although, as a key exporter, is crucial for the current account position," Davies said. Almost all business sectors have been affected in some way, with small businesses particularly hard-hit, he said.

Eskom has also reduced power supply to neighboring countries, which are some of South Africa's major trading partners. (Reuters photo)
Last week's power outages made the raw materials for the bling soar on the open markets with an ounce of gold worth almost $925USD and platinum hitting the $1700 mark. Bling is worth more while the destruction to the South African economy is without a fixed monetary value due to lost wages, missed productivity and soaring energy costs. A riot almost ensued when South Africans found they were still charged for down time. Traffic already awful in J-burg and elsewhere is now sit and wait, wait some more as they call into local radio shows to complain, then wait as road rage builds. Wasting time is not the worst of it, the power goes off with out warning affecting patients dependent on breathing machines, restaurants have food spoilage and people become stuck in lifts. Farmers need water for pumps. Black townships are accustomed to the random outages, the white South African population is seeing a new energy reality disrupt their lives.

Restaurants have been particularly hard-hit.

"We're without power up to four times a week, often at our peak time in the early evening," says Lizaan Joubert, the manager of the Orient Restaurant at Melrose Arch in Johannesburg.

"It puts enormous pressure on our kitchen, and it affects the menu. Our customers remain loyal to us, but from a business perspective, this is the worst thing that's happened to us."

Mrs Sonnenberg, who is in a wheelchair, says it is especially worrying when the power goes off without warning at night.
The power issue will not subside soon. It is slated to be a two year fix with heavy emphasis on conservation. The two year mark is non-negotiable because South Africa is due to host World Cup Soccer with an expected attendance of over a quarter of a million people to descend to upon the venues and use power for showers and shopping. Soccer or football is a sport beloved by most of the civilized world and yawned at by most Americans. It is now a national emergency with no other priorities to take its place.

More about South Africa's regional economic alliances and resources are found inside inside this comprehensive offering by James J. Hentz. The title of this body of work discussing the changes of economic realities from being a conquest of colonialism to apartheid to a functioning democracy with economic interests is South Africa and the Logic of Regional Cooperation.

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