As I sit here and write this today, I can not help but think that was is happening currently in South Africa has a few similarities to how it all began in Zimbabwe a couple of years ago. It started with the whole loading shedding by Eskom. Zimbabwe too started load shedding to help ease their electricity problems. Fast forward a few years and Zimbabwe is literally plunged into darkness now with very little electricity being produced in the country and lack of foreign currency to import any electricity. We in South Africa now are complaining about load shedding but we may have to brace ourselves for even more power cuts if a solution is not made. We are busy fighting about whether there should be a 50% hike in electricity tariffs or not. Either way, we are going to suffer if the hike is met or not. If the hike happens, inflation will go through the roof and prices of commodities will become unaffordable for many. A rising inflation is not good for any economy, just ask our neighbours in the north.

On the other hand if the electricity price hike does not go ahead, we will be plunged into potential darkness, so either way it is a loose-loose situation. The price of petrol, diesel and paraffin continues to rise. Well at least for now there is still a commodity to buy unlike in Zimbabwe where they do not even have the fuel. But mind you, Zimbabwe started like this, the fuel was there but prices continued to rise until there was no more product to sell due to the lack of foreign currency. The beauty about South Africa now is that we still have foreign currency all be it that the rand is a very volatile currency. Not too long ago the rand was trading at R8 to the dollar but now it has pulled back to the R7.50 mark. I recall the day in Zimbabwe when their currency dropped by a large amount and it was dubbed a black Friday. Let us hope South Africa does not have a black Friday and we see the rand crash to R15 to the dollar! Mind you there was a day a few months back in Cape Town when the whole city was plunged into darkness and I thought I would wake up the following morning and hear that the rand had crashed thus referencing a black Friday for south Africa!

Food prices are getting out of hand now. Walking into a supermarket with R100 today will buy you very little. In the past, one could walk out with quite a bit with that same amount. At least we still have food on the shelves in the shops compared to our neighbours in the north.

Some of the things that drove Zimbabwe to where it is to do were caused by the lack of foreign currency in the country which prevented essentials such as fuel, electricity and food being imported into the country. Inflation went buck wild in Zimbabwe and is reported to be 100 000% today. Here we are fighting 10% inflation. We are much better off than or neighbours but if this 10% is not controlled we could start to follow suite and the inflation rate could continue to go up. The point I am trying to make today is that I hope South Africa does not go down the same path as Zimbabwe. We have a real life case study to look at in Zimbabwe and we should learn from what they did wrong and make sure it does not happen in South Africa.

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