South African companies brace for social unrest in election build-up 

Pulp and paper manufacturer Sappi is closely monitoring signs of potential social unrest in South Africa in the build-up to next year’s elections, echoing the concerns of other businesses. 

This was revealed in the company’s integrated annual report for the 2023 financial year, where the company said there is a constant threat of social unrest due to widespread dissatisfaction with service delivery. 

“While the risk of community unrest and potential disruptive impact on our operations has stabilised, as the country prepares for 2024 national elections, political activities can be expected to intensify,” Sappi said in its report. 

Sappi suffered a more than R220 million loss of production after civil unrest in July 2021 caused disruptions to raw material supplies and forced the temporary closure of the Saiccor, Tugela and Stanger mills in KwaZulu-Natal. 

It was also forced to close them in response to flood damage in 2022 temporarily.

The company also said that due to the government’s failure to provide services, local communities have begun to look to private companies to solve social problems. 

Sappi supports local communities within a 30-kilometre radius of its operations, “many of whom have expectations of Sappi to resolve social demands”. 

“In some instances, this negatively affects our reputation and relationships with communities, many of whom look to us to take on the government’s role,” the company said. 

Sappi’s warning echoes that of one of the country’s largest food producers, Astral Foods, whose chairman warned of social instability in South Africa in the near future and beyond the national elections. 

One of chairman Theuns Eloff’s main concerns was that the South African economy had stagnated, with negligible economic growth. 

This has severe knock-on effects for consumers as their income stagnates while inflation and interest rates remain high. 

“Soaring unemployment rates, deteriorating consumer spend, and a weak currency are all proving detrimental to any real growth,” Eloff wrote. 

“All these macroeconomic factors, outside of management’s control, make for a bleak outlook.”

This bleak outlook is compounded by the prospect of heightened social and political instability leading up to next year’s election. 

“We expect that the socio-political instability in South Africa will continue until the National Election in 2024, and possibly beyond that,” Eloff warned. 

Governance expert Dr Sam Koma said service delivery protests tend to ramp up before the 2024 elections. According to Municipal IQ, the number of service-delivery protests in South Africa will reach a new annual record in 2023.

Protest action picks up because communities know politicians will be forced to do something about their demands as they need votes for the upcoming elections.

Koma said most South Africans face a cost of living crisis, forcing them to forfeit some of their basic needs while unemployment, poverty, and inequality remain elevated. 

When this is coupled with communities saying they have been raising service delivery demands to local municipalities and politicians, but no action has been taken, protest is their only option. 

“Increasingly, they sense that they are not being listened to. This is when they would normally decide to embark on a protest to register this displeasure with local government and politicians,” Koma said. 

Koma warned that these protests tend to turn violent as the police fail to respond appropriately due to capacity constraints and a lack of information within the security cluster. 

The South African Police Service (SAPS) has admitted previously that they are facing severe capacity constraints. 

Koma said the police currently have 5,500 members of the public order policing division, while the ideal operational strength is around 13,000. 

“This must be understood as one of the contributing deficiencies facing the police in terms of handling a large crowd and responding appropriately to protests.”