The looming “super El Niño” has been dominating local and international media, driven by the scientific analysis of decades of data. But with all the alarmist headlines and social media content on the matter, it may be easy to dismiss the signal for the noise. Analysis of trends and data helps people plan. In this case, especially, the agricultural sectors in South Africa can adjust and plan for a potentially drier and hotter summer season. Some local agricultural sectors are already preparing the market for lower yields this year, into next. This in turn affects planning regarding food supply, agricultural commodity pricing and futures, and supply contracts locally and potentially for export.

Once you strip away the headlines and social media churn, what remains is extremely important: advance notice gives relevant sectors the ability to plan for a potential future problem. We cannot know with 100% certainty what impact this El Niño cycle will hold for South Africa, or how long it will last. But recent examples in South Africa show that solving for a potential future problem is always better stumbling through a crisis.

Take Johannesburg’s water crisis. It did not arrive with a drought. It arrived with planned upstream maintenance by Rand Water, the kind of scheduled work a functioning distribution network absorbs without residents noticing. Instead, large parts of Gauteng went without water for days, because municipal reservoirs are leaking or bypassed, and the pipe network has been left to degrade for years. The condition of the city’s infrastructure had been set out in successive municipal reports and national assessments. A routine engineering exercise turned into a crisis because the decade of deferred spending left the system at breaking point.

A similar crisis, with similar forewarning, slowly played out over a number of decades in South Africa. A 1998 white paper warned that Eskom’s generation surplus would be fully used by about 2007, and that the next supply-side investment decision needed to be taken by the end of 1999. The reserve margin fell from 27% in 1999 to 5% ten years later. The first blackouts arrived in late 2007 and led to an ongoing electricity crisis that would peak in the early 2020s.

Plans to avert such a crisis point may have been costly to implement timeously, but we may never fully know how much trying to survive the crisis without that planning cost the country in lost jobs, lost business, and years of weak economic growth.

Neither examples was a failure of information. But they serve to illustrate how a future problem can become current one, and how such a problem can escalate into a crisis if not managed properly.

This applies well beyond the response of the state. Future economic growth and employment depend on how industries are nurtured now, because a skills pipeline and infrastructure investment take years to produce to come to fruition. Regulations and rules that are debated in Parliament today will shape the economy and country decades into the future. How we debate, regulation and incentivise industries now, may affect whether we have a seat at the table a decade from now when it comes to biofuels, the global financial system, access to globalised marketplaces, and even agricultural exports into markets that are already writing their carbon and traceability rules without us.

A democracy means that it is up to all of us, individuals and the private sector, to equip our elected policy makers with the right information and tools to position South Africa as a forward-looking economy.

There are many “super El Niño” moments right now for South Africa. The lesson lurking beneath the headlines is that solving for a potential future problem is more cost effective than scraping by during a crisis.

– Gerhard Mulder
Account Director