This is the first of a new monthly feature in which I will be highlighting some of the latest research by the Centre for Risk Analysis (CRA) on political, economic and geopolitical events affecting South African businesses.
CRA premium clients receive a range of weekly and monthly reports, including Client Notes, which are published ad hoc to offer real-time analysis of topical issues.
What follows is a selection from this month’s Client Notes, featuring analysis of reforms of the country’s rail network, the importance of the Strait of Hormuz, and what could come next for President Ramaphosa and the GNU.
The rails are open, but Transnet keeps the track
In this note, CRA Executive Director Chris Hattingh unpacks the National Rail Master Plan (NRMP), which was launched by transport minister Barbara Creecy on 24 April. The plan outlines a R1.9 trillion investment over 30 years to revitalise South Africa’s rail system.
The plan aims at increasing freight volumes from 165 million tonnes to 250 million tonnes by 2029/30. It includes expanding the rail network by 3,600 kilometres and gradually opening it to third-party operators.
However, a key contradiction arises from the state’s owning the rail infrastructure, which poses risks for private investors focused on financial returns, while the government retains traffic and revenue risks.
Despite the NRMP’s sound economic rationale, significant challenges remain. The Rail Infrastructure Manager struggles with financial issues and prioritises maintenance over investment.
Hattingh writes that South Africa “has produced rail policy before,” but warns: “Private capital will not wait indefinitely for the regulatory framework to be written….”
Hattingh adds: “If the first concession agreements are structured to protect Transnet rather than attract capital, the NRMP will join a long list of credible South African policy documents that were never matched by the necessary level of political will or deeper ideological changes.”
Semiconductors: South Africa’s hidden supply-chain vulnerability
In this note, CRA research associate Ofentse Davhie writes that in 2025, South Africa faced significant semiconductor supply-chain vulnerability, importing R4.56 billion worth of semiconductor devices while exporting only R468 million, leading to a troubling 10:1 import-to-export ratio.
This heavy reliance on global supply chains, particularly in China’s favour, underscores the country’s lack of influence in the geopolitical landscape. As demand for advanced chips increases, particularly with the rise of artificial intelligence, the dependency on Chinese manufacturing and assembly poses risks.
The situation is compounded by geopolitical tensions, as evidenced by the Pax Silica Declaration, aiming to secure AI semiconductor supply chains but excluding South Africa from participation.
Disruptions, such as Taiwan’s brief threat to implement export controls over diplomatic tensions with Pretoria, highlight the fragility of South Africa’s semiconductor access.
Davhie writes: “This vulnerability cannot be solved domestically, but it can be actively managed.” He continues: “… South African firms should work to diversify supply sources by building stronger direct relationships with US, Japanese, and European suppliers for key components.”
He concludes: “At a broader level, South Africa should position itself as a stable and attractive African partner within trusted supply chains by leveraging its mineral resources and existing manufacturing strengths in the automotive sector.”
Setting up tripwires to prepare for political risks
In this note, Ofentse Davhie details how in an emergency room, predefined protocols ensure immediate action when critical conditions arise, such as a flatlined ECG, with roles and sequences established in advance.
Conversely, during the airstrikes against Iran on 28 February 2026, many organisations lacked any such mechanism to respond to geopolitical events that stood to disrupt critical maritime chokepoints. The ongoing conflict has highlighted that the global economy is influenced not only by military might but also by control of vital supply routes. Davhie emphasises the need for businesses to establish clear indicators and predefined action plans for when risks materialise.
Tripwires differ from forecasts in focusing on identifying specific observable conditions that trigger predetermined responses rather than attempting to predict future events. For organisations, this means identifying concrete indicators, such as sustained high oil prices or confirmed disruptions in the Strait of Hormuz and linking them to actionable protocols.
Davhie writes: “Risk tolerance must be defined, regularly updated and understood across business units.” He emphasises that when a disruption occurs, “each part of the organisation should already know its response”.
The ongoing situation in the Gulf necessitates that firms articulate clear conditions for action, considering the prolonged nature of disruptions and the importance of being prepared for future shocks. “The question is therefore not whether another disruption will occur, but whether firms have defined, in advance, the conditions under which they act.”
Mr Phala Phala: Will he stay or will he go?
In this note, CRA Director Dr John Endres and Executive Director Hattingh analyse the Constitutional Court’s ruling on the Phala Phala scandal, and how it has pushed the African National Congress (ANC) into a risky position ahead of the November local government elections.
Having confirmed that Parliament acted unconstitutionally by squashing the impeachment process, the court has forced the ANC to confront an active, legally validated scandal. While a quick resignation could theoretically limit the electoral fallout, it remains highly unlikely due to President Cyril Ramaphosa’s refusal to step down.
Similarly, a formal impeachment or a motion of no confidence is unlikely to succeed because the ANC can block the two-thirds majority required for impeachment. The GNU partners are also incentivised to protect their ministerial positions.
Endres and Hattingh conclude that the most probable outcome is a “bumpy” scenario where Ramaphosa remains in office as an embattled and weakened president. He faces a race against time to secure a high court review and a legal interdict to halt the parliamentary impeachment committee, all while engaging in intense internal factional warfare.
This protracted saga will generate weeks of damaging headlines inspired by the strategies of opposition parties like the MKP and EFF, which will likely erode the ANC’s voter support. This will foster a more transactional, less stable GNU as partners like the DA distance themselves to protect their own reputation.
For more on the CRA’s products and services, which include Risk Alerts and Strategic Intelligence Briefings, contact Chris Hattingh at chris@cra-sa.com
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