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11 March 2022 | Story Prof Frikkie Maré | Photo Supplied
Prof Frikkie Maré is from the Department of Agricultural Economics at the University of the Free State (UFS)

Opinion article by Prof Frikkie Maré, Department of Agricultural Economics, University of the Free State.
In William Shakespeare’s play Julius Caesar, Mark Antony utters the words: “Cry ‘Havoc!’, and let slip the dogs of war,” after learning about the murder of Julius Caesar. With these words he meant that chaos would ensue (havoc) to create the opportunity for violence (let slip the dogs of war).

The recent invasion (or military operation, according to Russian President Vladimir Putin) by Russian armed forces into Ukraine brought the famous words of Shakespeare to mind. Putin cried “Havoc!” and his troops created chaos in Ukraine. This is, however, not where it stopped because the dogs of war have been released into the rest of the world.

What is the impact on South Africa?

The day after the invasion we felt the bite of the dogs of war in South Africa. The rand suddenly weakened against the dollar, oil and gold prices increased sharply, and grain and oilseed prices on commodity markets increased 

This was before the rest of the world started to implement sanctions against Russia, which could be described as a shock reaction due to uncertainty as to how the situation would unfold. In the days after the initial market reaction we saw the markets actually “cool down” a bit, with most sharp initial reactions starting to change back to former positions. This period was, however, short-lived when the world hit back by closing airspace and borders and refusing to import products from Russia or export to them. The sanctions were in solidarity with Ukraine as an attempt to bring the Russian economy to its knees and force the Russians to withdraw from Ukraine.

Although the sanctions against Russia should certainly be successful over the long term, it does not change much in the short term and we will have to deal with the international effects of this conflict. The question then is, how will this affect South Africa?

Although there are no straightforward answers, as the impact will depend on what one’s role is in the economy. One thing for certain is that the total cost will outnumber the benefits. What affects everyone in South Africa, and the starting point of many secondary effects, is the increase in the price of crude oil. Russia is the second-largest producer of crude oil in the world and if the West is going to ban the import of Russian oil we will have an international shortage. Although the banning of Russian oil is the right thing to do to support Ukraine, it will have devastating effects on all countries in the world, with sharp increases in inflation.  

The increase in the price of oil not only drives up the cost of transportation of people and products, but also manufacturing costs. Fertiliser prices are correlated with the oil price, and it will thus drive up the production cost of grain and oilseeds.

Speaking of grain and oilseed prices, the Black Sea region (which includes Russia and Ukraine), are major exporters of wheat and sunflower seed and oil. The prices of these commodities have soared in international and South Africa markets over the past few weeks. Although it might seem like good news for our farmers, the increase in prices are offset by high fertiliser prices and the local shortage of fertiliser. This may lead to fewer hectares of wheat being planted this year in the winter rainfall regions.  

Nothing good is coming from this situation

In terms of agricultural commodities, both Russia and Ukraine are important importers of South African products, especially citrus, stone fruit and grapes.  Alternative markets now need to be found for these products which will affect prices negatively.

Although one needs to write a thesis to explain all the effects of the Russian-Ukraine conflict, the dogs of war have been slipped, and it is clear from the few examples that nothing good is coming from this situation. In short, we will see higher fuel prices (maybe not R40/litre, but R25 to R30/litre is possible), higher food prices, higher inflation and a higher interest rate.  

These factors affect all South-Africans, especially the poor and some in the middle class who will struggle in the short term. The time has come to cut down on luxuries and tighten belts to survive in the short term until there is certainty about how the havoc in Ukraine will play out.

News Archive

Protest actions planned for 12-14 March 2008
2008-03-13

Three protest actions will take place on the Main Campus of the University of the Free State (UFS) in Bloemfontein this week.

Although the interim court interdict granted to the UFS on 6 March 2008 is still in force, permission for the three protests was granted by the Mangaung Local Municipality and the court, in the presence of the university lawyer. Strict conditions have been set for these protest actions.

The UFS management respects the right to peaceful protest and also shares the sentiment of the protesters regarding the reprehensible Reitz video. However, strict conditions have been set for these protest actions as students are writing tests and the normal academic activities should not be disrupted.

Already the first picket protest took place today, Wednesday, 12 March 2008, by about 300 Satawu and Nehawu members. This was not a march and no memorandum was handed over.

On Thursday, 13 March 2008, Nehawu will again picket in front of the Main Building from 13:00 to 14:00. This event must be peaceful. This too is not a march and no memorandum will be handed over.

On Friday, 14 March 2008, a march of Cosatu and Nehawu will take place, starting in the city centre. The march will enter through the Nelson Mandela Drive gate and will enter the campus grounds.

However, it will be limited to the incoming lane of Chancellors Avenue from the Main Gate to the crossing with Alumni Avenue (in front of the Odeion building). Speeches will be made and a memorandum will be handed over.

It is expected that the march will reach the campus at approximately 10:00 and from then the Nelson Mandela Gate to the UFS will be closed for all traffic. The march must end by 14:00. The marchers will return to the city centre and may cause a traffic problem in Nelson Mandela Drive.

The South African Police Service (SAPS) and the UFS’s Protection Services Division will monitor all these actions. Staff, students and visitors to the campus are kindly requested to use alternative gates to the Nelson Mandela entrance on Friday. Academic activities will continue as normal this week.

Media Release
Issued by: Anton Fisher
Director: Strategic Communication
Tel: 051 401 3422
Cell: 072 207 8334
E-mail: fishera.stg@ufs.ac.za  
12 March 2008


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