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SA deploys thousands more soldiers to help quash riots

Attention now turning to whether insurance companies will be able to cover the costs.
Image: GCIS

South Africa will significantly ramp up the number of soldiers deployed to help quell riots following days of looting and destruction of businesses, after the government said a military presence may be helping to ease the violence.

Defence Minister Nosiviwe Mapisa-Nqakula told lawmakers that troops in the provinces of KwaZulu-Natal and Gauteng will be boosted to 25,000 from about 5,000 now, following a discussion between the government and opposition parties.

“We are seeing less incidence of violence and looting reported,” acting Minister in the Presidency Khumbudzo Ntshavheni had earlier told reporters in Pretoria, the capital. More than 1,700 people have been arrested, she said.

Protests erupted on July 10 after former President Jacob Zuma was incarcerated for defying a court order to testify before a graft inquiry and degenerated into a free-for-all in KwaZulu-Natal and Gauteng, two of the country’s main economic hubs. At least 72 people have been killed, making the uprising the deadliest since apartheid ended in 1994.

Marauding mobs have ransacked hundreds of businesses and destroyed telecommunications towers and other infrastructure, while transport networks and a program to vaccinate people against the coronavirus have been disrupted. The government logged 208 separate incidents of violence overnight Tuesday.

Business Leadership South Africa, one of the main business lobby groups, estimates that damages amount to more than R5 billion and counting for the retail industry alone. More than 200 malls were targeted, over 800 stores were looted and 100 were completely burnt, its Chief Executive Officer Busi Mavuso said in an emailed reply to questions.

Insurance headache
Attention is now turning to whether insurance companies will be able to cover the cost of the carnage, with claims estimated to run into several billions of rand. Much of that will have to be considered by Sasria, a South African state-owned company that specialises in cover related to social unrest and rioting.

The sheer number of affected businesses mean it’s likely that processing claims will be slow and an interim fund may have to be set up for support, said Martin Kingston, representing Business Unity South Africa, another industry group.

BUSA is calling for a rolling 24-hour curfew in the key provinces and a full deployment of the armed forces to bring an end to the crisis.

Infrastructure lost
“It will take two-to-three years to recover the infrastructure lost here,” Colin Coleman, former chairman of Goldman Sachs Group Inc. in Sub-Saharan Africa said in an interview to Bloomberg TV. “To restock these centres will take 10 weeks and we are going to have severe shortages for some time.”

Ntshavheni urged people not to resort to panic buying because there is enough food for everyone, and said the security agencies will escort vehicles carrying goods from KwaZulu-Natal’s Durban port, the country’s largest, to destinations inland to safeguard supply chains. She described the violence as “economic sabotage.”

“We are not at liberty to announce who are behind it,” she said. “If we do so we will jeopardise the investigation and possible prosecution of people.”

Some business groups have urged President Cyril Ramaphosa to give the police and army additional powers to end the violence, fearing that communities and private militias will mete out their own form of justice. Video footage published on Johannesburg-based radio station Kaya 959’s website showed private security guards firing live ammunition at a mob on Tuesday.

While the government has shied away from declaring a state of emergency — a measure the apartheid regime used to counter opposition to White-minority rule, Ntshavheni said it could review its stance depending on how the situation evolves.

Ramaphosa’s office said he’d consulted with the leaders of religious groups, business and political parties on how best to restore stability.

The rand weakened 0.6% to 14.57 as of 12:43 p.m. Thursday after a Wednesday rally. A foreign exit from South African stocks has gathered pace, with non-residents selling 4 billion rand of local equities on Tuesday, the largest outflows since November.

Paper producer Sappi Ltd., retailer Mr Price Group Ltd. and fast-food restaurant operator Famous Brands Ltd. have joined a long list of firms whose operations have been interrupted. Hapag Lloyd AG told customers that it’s shutting some of its container-shipping facilities.

© 2021 Bloomberg L.P.

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“We are not at liberty to announce who are behind it,” she said. “If we do so we will jeopardise the investigation and possible prosecution of people.”

My guess is you have no idea. None. Totally clueless, like the rest of the cabinet.

Too late. The damage is done. The army should have been deployed the day before Zuma was to be locked up. Prevention is better than cure.

Nothing is deployed you lying scum.It was only a suggestion made yesterday.

If looters expect anything less than live ammunition to rain down on their criminal escapades, they are even more stupid than they have already shown themselves to be.

End of comments.

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