Moody's upgrades South Africa's outlook from ‘negative’ to ‘stable’

Fin24 – 08 April 2022

• The credit rating agency Moody's upgraded its outlook on South Africa from "negative" (which meant the next step could potentially be another downgrade) to "stable".
• While government bonds are still rated as "junk", Moody's says South Africa's fiscal position has "markedly recovered".
• It praised the state's ability to keep growth in the public sector wage bill to below inflation. 

The credit rating agency Moody's upgraded its outlook on South Africa from “negative” to “stable”.

Moody’s previously rated South Africa at Ba2 (two rungs below investment grade), with a negative outlook – which means the next step could potentially be another downgrade.

It is keeping South Africa at Ba2, but changed its outlook to “stable”, saying that South Africa's fiscal position has “markedly recovered” from the pandemic thanks to high commodity prices, which boosted tax revenue, and government's fiscal consolidation measures, including that it was able to keep growth in the public sector wage bill to 1.6%, well below inflation.

“Indeed, over the last two fiscal years, the government has shown it was able to re-prioritise its spending while staying committed to fiscal consolidation, which Moody's expects will remain the case going forwards.”

In 2020, Moody’s stripped South Africa of its investment grade rating, downgrading government bonds to "junk". A "junk" rating means there's a bigger chance that the government won’t be able to pay back its debts.

"This marks an improvement compared to Moody's previous projections of a long period of ever-rising debt-to-GDP."

Government has managed to cut its primary deficit (the difference between its income and spending, excluding interest payments) to 1.3% of GDP over the past year, compared to Moody’s forecast of 3.4%.

Moody’s also expects that tax compliance is likely to improve gradually as the South African Revenue Agency (SARS) rebuilds some of its institutional capacity, and highlighted South Africa's “sound” financial sector, as well as strong exports thanks to commodity prices.

In addition, it noted that the Reserve Bank's foreign-exchange reserves fully covered annual external debt payments. “The central bank has a long-standing policy of refraining from intervening to prevent depreciation, thereby preserving buffers.”

But it warned that the state-owned enterprises (SOEs) remain weak and poses risks to government’s debt burden. In addition, a “malfunctioning” labour market could fuel “social risk” and Moody’s is also concerned about the impact of load shedding on the economy.

“Moody's expects these constraints to remain and forecasts GDP growth at only about 1.5% in the medium term.

“Very weak SOEs across a number of sectors, including electricity and transport, both contribute to weak growth and are affected by it, without any prospects of significant improvements in the foreseeable future.”

Still, it said that South Africa’s ratings could be upgraded if it showed significant progress towards alleviating these structural constraints on growth. "Firm signs that the rehabilitation of the energy sector is underway would also be a key marker, pointing to higher growth and lower contingent liability risks from the SOEs sector."

Ratings could be downgraded if growth prospects and government’s fiscal strength deteriorated.

In a statement, National Treasury welcomed Moody’s upgrade to South Africa’s outlook.

It said that government is using a part of its additional tax income (a windfall due to the high commodity prices) to pay off more debt, while most of it will go towards urgent social needs, including job creation through the presidential employment initiative, and supporting the public health sector.

“Faster implementation of economic and SOC [state-owned corporation] reforms, accompanied by fiscal consolidation to provide a stable foundation for growth, will ease investor concerns, and support a faster recovery and higher levels of economic growth,” Treasury said.

www.samigration.com

Shambolic Home Affairs leaves legal immigrants undocumented

GroundUp 8 Apr 2022

 

 

Since lockdown asylum seekers and refugees have been denied crucial services

 

Immigrants are struggling to document their status because of the continued closure of in-person services at Home Affairs refugee reception offices. Image: Tariro Washinyira

• Refugees and asylum seekers are facing a myriad of problems because Home Affairs has not provided crucial in-person services for two years.
• Despite a blanket extension of permits various government departments and private sector facilities are not accepting valid documents, not even some Home Affairs officers.
• There are numerous complaints of problems with the Home Affairs online system introduced for permit renewals.

Terrence is a Zimbabwean refugee in South Africa. He has tried seven times to renew his status through the Home Affairs online portal, but he has never received a response, he says.

His papers expired in October 2020, but Home Affairs announced that asylum seeker and refugee permits that expired after 15 March 2020 have been extended up to and including 30 April 2022. This was because Home Affairs had closed its refugee reception offices since lockdown.

Terrence wants to officially marry his customary law wife. So he went in person to the Regional Home Affairs office in central Johannesburg, only to be told by a supervisor to bring “a valid document” because his asylum document had expired.

He was told the blank extension is only to allow refugees to renew. “So I have to wait for the renewed status and then get married”.

But this is incorrect as the blanket extension clearly extends “the validity” of visas and permits.

“I do not understand how a Home Affairs office does not understand its own system … My wife is getting tired of waiting, not knowing if we will get married,” said Terrence.

He also said not having renewed documents in hand was affecting his employment contract and his child’s schooling.

Home Affairs launched its online renewal system for asylum seekers and refugees, but since its inception last year GroundUp has received emails and calls from asylum seekers experiencing difficulties with the portal.

With the closure of in-person services at Refugee Reception Offices it has also not been possible for many refugees and asylum seekers to legalise or document their status, even though they have entered the country perfectly legally.

Also, people who have lost their documents, because of anything from carelessness to robbery to fire, have no way currently to verify their status.

An Ethiopian refugee, Abera, says he cannot renew online since he lost his refugee document and he cannot remember his reference number.

Another distraught refugee told GroundUp that his bank insisted his refugee status be verified. “The documents are given by the South African government … Do banks verify South Africans green IDs as well? This segregation needs to stop.”

The “family joining” process – granting refugee status or a similar secure status to family members accompanying a recognised refugee – has also ground to a halt.

Children who have been born in South Africa to refugees are sitting without birth certificates, because their mothers are undocumented.

Sharon Ekambaram of Lawyers For Human Rights (LHR) also confirmed that refugees have been reporting a breakdown of Home Affairs systems. She said the failure by Home Affairs to issue a directive that the “document provided to asylum seekers that has the Covid watermark is a legitimate document, shows the contempt” Home Affairs has for poor people.

Acting National Director of the Somali Association of South Africa Abdikadir Mohamed said the South African Social Security Agency (Sassa) Pretoria local office was refusing to recognise refugee documents renewed online.

“Sassa officials punched holes in the documents that were renewed online to ensure they are not used again. They also threatened to arrest the refugees,” said Mohamed.

Sassa’s spokesperson Paseka Cornelius Letsatsi failed to respond to our questions.

We have also repeatedly sent questions to Home Affairs but received no reply.

www.samigration.com

 

Immigration officer who tried to buy 5,000 permits gets 15 years in jail

By TIMESLIVE - 07

April 2022

 

An immigration officer and an Ethiopian who tried to set up a huge illegal-permit operation were each sentenced to 15 years behind bars.
Image: belchonock/123rf.com

An immigration officer who paid R150,000 to get 5,000 blank permits for fraudulent use by foreign nationals has been sentenced to 15 years in jail, the home affairs department said on Wednesday.

The immigration officer, Nasi Seqola, was nabbed alongside an Ethiopian national who was working with her. The Ethiopian, Biru Yosef Alem, was in possession of a permanent residence permit at the time of his arrest. This has since been revoked.

Home affairs minister Aaron Motsoaledi on Wednesday applauded the arrest of Alem and Seqola, saying their arrests put the brakes on what would have been a huge crime.

Explaining how the two were caught, the department said Seqola tried to recruit an official from Government Printing Works (GPW) to print 5,000 blank permits in return for R150 000.

The official, however, reported Seqola to the counter-corruption branch which set up a sting operation.

“The 5,000 permits were printed by GPW and handed over to law-enforcement officers. The permits were used in a sting and Ms Seqola paid the R150,000. Then the law-enforcement officers moved in and took the cash and the permits. The permits were returned to GPW. This avoided what could have been a catastrophe in terms of permitting,” the department said.

Explaining how the plot would have worked, the department said Alem would have recruited foreigners who did not qualify for South Africans permits; bring them to Seqola who would have completed a fraudulent permit and then used her corrupt contacts at home affairs to insert such a permit into the data base.

Seqola and Alem were convicted in October 2021 but were sentenced on Monday.

Motsoaledi said he believed the sentence suited the crime.

“This sentence reflects the severity of the crime. People who do not respect the country’s immigration laws must face the full might of the law,” said Motsoaledi. “We congratulate the patriotic GPW official who resisted huge amounts of money and remained honest to his job and his country.”  

Alem will be deported once he has served his time.

www.samigration.com

Fake passport syndicate worms its way deep into Home Affairs

Sunday World – 7 Apr 2022

 

https://sundayworld.co.za/news/fake-passport-syndicate-worms-its-way-deep-into-home-affairs/

An explosive report prepared by the Department of Home Affairs’ top brass has lifted the lid on the extent to which the recently uncovered fake passport syndicate has penetrated the department, which is a “serious” security breach for the republic.

On Thursday, members of the Home Affairs Counter Corruption Branch and Hawks arrested a Pakistani man at the Cape Town International Airport for suspected fraudulent activities that include the production of bogus passports.

Majid Hussain, who was trying to flee South Africa, appeared in the Bellville Magistrate’s Court this week on charges of fraud, corruption, contravention of the Immigration Act, and the possession of suspected fraudulent documents.

Last week, another Pakistani man, the kingpin of the syndicate, along with his wife and 29 others, was arrested after a raid at the department’s Krugersdorp offices.

It has now emerged that the criminal network – which includes 13 foreigners and 13 South Africans – spanned Gauteng, Limpopo, KwaZulu-Natal, Eastern Cape, Western Cape, and Mpumalanga.

A confidential report we have seen shows that the syndicate has been working with security guards and corrupt department officials to gain access to offices throughout the country and produce fraudulent documents outside working hours, at times in the wee hours of the morning.

The report, prepared for Minister Aaron Motsoaledi, shows that at the Maponya Mall in Soweto, three officials – who include an office manager – involved in the scam helped more than 50 foreigners obtain fake passports. At the Germiston office, two officials have helped 15 foreigners get fraudulent passports.

In KwaZulu-Natal, two officials have assisted five foreigners at the Ndwedwe office; at the Durban medium office in Commercial Road, seven foreigners were assisted by two officials to get fake documents; and an official at the Tongaat office was identified as helping a foreigner get a bogus passport.

The report further says that seven foreigners and a South African were transported from Gauteng to the Mpumalanga White River office to obtain counterfeit passports in a transaction that happened at 4 am.

Other places where the syndicate operates include the Vereeniging large office, where an official has already assisted seven foreigners to get passports through the photo swapping scam, while in the Western Cape’s Nyanga and Atlantis offices, officials have been fingered for working with the criminals to issue fake passports to seven foreigners.

Sunday World understands more arrests are expected this week in connection with the syndicate that has been behind the so-called “photo swap”, which operated nationally using vulnerable young people who sold their identities to foreigners, effectively removing the locals from the population register.

In the scam, South Africans are ferried at night to a Home Affairs office. Officials then help the kingpin access the details of the South African through his fingerprints. The South African’s photo is then replaced with a picture of a foreign national. The photo-swapping scandal is not only compromising the security of the country but has the potential to become an issue for South Africans wishing to travel abroad.

“If the problem of photo swapping in the passport application process is not addressed urgently, it will result in further visa restrictions to the country and the security of the country [being] compromised,” the report states.

In September last year, two foreigners were arrested at the Cape Town International Airport for being in possession of fake passports. It later transpired they were working in cahoots with Home Affairs officials and the matter was reported to the police.

“Our efforts to close loopholes in the passport processes, however, also resulted in criminals changing their modus operandi to acquire South African enabling documents. Four Cameroonians recently acquired South African passports with the assistance of South Africans who displayed similar looks and features  [so-called lookalikes],” the report notes.

A high-ranking Home Affairs official said they had found that most of the counterfeit passports were sold to Pakistanis. “We want to get rid of the security companies that were complicit. This is a serious security breach,” he said.

Last week, the ANC national executive committee (NEC) supported measures by Motsoaledi to ensure effective border management, strengthen Home Affairs systems to prevent illegal activities, and address equitable access to employment for SA citizens.

“It [the NEC] urges citizens who have legitimate concerns regarding the presence of illegal and undocumented immigrants to work with the relevant authorities to ensure that our laws are implemented.

“The ANC calls upon law enforcement and other agencies to act against both illegal and undocumented immigrants, unscrupulous employers, and corrupt officials who fail to enforce our laws.”

The integrity of the South African passport has come under the spotlight and resulted in the UK introducing a strict passport regime for South Africans seeking entry into the UK

www.samigration.com

 

Calls for Home Affairs overhaul after cable breakage shuts down services, leaving angry customers stranded

Cape Times -  Apr 7, 2022

CAPE TOWN - Calls have grown for an overhaul of the Department of Home Affairs after a cable breakage shutdown services across the country.

The breakage, which connects to the State Information Technology Agency (SITA), caused the department’s services to come to a standstill on Friday.

It managed to restore its online service only on Sunday afternoon.

Home Affairs Ministry spokesperson Siya Qoza said the department will be extending operating hours on Monday to compensate for the time lost.

Due to the network outage, Qoza said the department ran limited services which included passport collections, and handwritten death certificates for burial purposes.

Computerised certificates would be issued from Monday.

“The Department of Home Affairs and the State Information Technology Agency have been able to fix the cable breakage that impacted service delivery on Friday.

“Home Affairs services have been restored. Home Affairs Minister Dr Aaron Motsoaledi has instructed the Department to extend operating hours to ensure that all clients that visited the offices on Friday are served,” said Qoza.

Motsoaledi apologised for the inconvenience and said the department owed it to the public to extend operating hours due to the “unfortunate network failure incident”.

Western Cape Standing Committee chairperson on Premier and Constitutional Affairs, Lorraine Botha, said the incident had a devastating effect on people’s lives.

“Our communities in rural areas especially, are paying such a lot for travelling fares to get to Home Affairs offices; money that they do not have in the first place.

“They then have to queue for long hours to get serviced. Even those just collecting their respective IDs have now to wait in a queue just to collect,” said Botha.

She said the department had to communicate clearly to communities on how they would be assisted when there was a system downtime.

The Public Servants Association (PSA) national manager Claude Naiker said the incident was nothing new to Home Affairs.

“The public has always blamed officials for the long queues and frustration at the delays in obtaining documentation.

“The IT system has always been problematic so an entire shutdown is surely a disaster to the already ailing system.

“The PSA has for years called for Home Affairs to completely overhaul the entire system,” said Naiker.

Action Society director Ian Cameron said it was a disgrace that the department which provides such a crucial service for people in the country has been allowed to deteriorate.

“It's nothing new that the system goes offline. It happens quite regularly. And it just goes to show that tax money has been looted. And I think that we're going to have extensive problems in the future with these types of services.”

The department will be open until 6:30pm on Monday.

Operating hours at home affairs offices will be extended to 6.30pm on Monday after the department’s systems went offline nationwide on Friday.

“The department of home affairs wishes to inform members of the public that services at the department have been restored. The department and the State IT Agency have been able to fix the cable breakage that impacted service delivery on Friday,” said the department in a statement.

Home affairs minister Aaron Motsoaledi instructed the department to extend Monday’s operating hours to ensure that all clients that visited the offices on Friday are served.

According to Motsoaledi, the department owes it to the public to extend operating hours to compensate for the unfortunate network failure incident. Branches will stay open until 6.30pm, and everyone who is in a branch by this time will be assisted.

“The department appreciates the patience of the public on Friday and apologises for the inconvenience caused by the unfortunate network failure.”

www.samigration.com