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SOUTH AFRICA MAY ASK PHARMA FIRMS FOR FEE TO CLEAR DRUG REVIEW BACKLOG

CAPE TOWN (ewn.co.za) – Delays for hundreds of medicines have kept the latest treatments off South African shelves and hampered the fight against cancer, heart and other diseases.

Drugmakers in Africa’s largest pharmaceutical market may be asked to pay a “backlog fee” to help clear a pipeline of medicines waiting years for approval, according to a proposal being considered by South Africa’s new industry regulator.

Delays for hundreds of medicines have kept the latest treatments off South African shelves and hampered the fight against cancer, heart and other diseases in a country which also has more people receiving antiretroviral drugs (ARVs) than anywhere else in the world.

Besides improving access to life-saving medication, analysts say the South African Health Products Regulatory Authority (Sahpra) proposal could help boost the revenue streams for companies competing in the $3.8 billion-a-year market.

“It’s the first time South Africa offers this and we would support a backlog fee, provided it is performance driven,” said Stavros Nicolaou, senior executive for strategic trade at Aspen Pharmacare.

Sahpra wants to cut the backlog and allow the regulatory assessment of all products in an “achievable but ambitious” timeframe, the authority told Reuters.

“As part of this process, Sahpra is also exploring other potential sources of revenue, including a backlog fee to … speed up the registration of products in the current backlog,” said Helen Rees, chairperson of Sahpra’s board.

Talks with industry on cost implications, procedures and schedule for implementation are ongoing, she said.

Adcock Ingram said it was keen to discuss Sahpra’s proposal to expedite reviews of its treatments.

“Adcock Ingram currently has more than 250 dossiers awaiting approval,” spokesperson Kavitha Kalicharan said.

The company has waited up to seven years for a regulatory decision on some of its products, she said, and speeding up the process could bolster its prescription division.

South Africa’s pharmaceutical market is forecast to grow at a compound annual rate of 7.3% over the next decade, reaching R87.5 billion by 2027 from R45.4 billion now, according to BMI Research.

FOCUS ON CHEAPER GENERICS

Replacing an apartheid-era Medicines Control Council lacking enough funds and expert staff, Sahpra will for the first time refer to prior reviews from other regulators when registering drugs and medical devices.

It will also prioritise treatments that meet public health needs and potentially reduce prices by boosting competition and licensing cheaper generics.

“Sahpra will prioritise the review of generic medicines to encourage market competition and improve affordability, but once market saturation has occurred, there will not be further prioritisation,” Rees told Reuters.

Africa’s most industrialised economy has a history of pushing to cut the prices of vital medicines, including winning concessions from big pharmaceutical firms to reduce the cost of ARVs used to control the HIV virus.

Industry body Ipasa, which represents just under half of South Africa’s pharmaceutical private sector, said that while generic medicines were good for bringing prices down, it wanted to avoid perceptions of bias.

“The government should not myopically just want to push generics at the expense of branded medicines,” said Dr Konji Sebati, chief executive of the Innovative Pharmaceutical Association South Africa (Ipasa).

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Biggest South Africa Cement Maker PPC Eyes Growth Post Turmoil

SOUTH AFRICA (Bloomberg) – PPC Ltd. is weighing expansion into new markets as South Africa’s biggest cement maker seeks to draw a line under a tumultuous two years that included an emergency rights issue and takeover interest from competitors.

Since taking the top job in July, Chief Executive Officer Johann Claassen has reviewed the company’s operations and balance sheet, with a particular focus on boosting liquidity and extending debt maturity, he said in an interview in Bloomberg’s Johannesburg office. “We had to steady the ship and make it sustainable,” he said. “Now we need to get a new pipeline of projects.”

New investment would follow a 12 billion rand ($995 million) outlay on five plants in the past half decade, which took PPC into countries including Ethiopia and the Democratic Republic of Congo from its South African base. All are now in operation and generating cash, said Claassen, 58, allowing the company to consider new facilities.

East Africa is a particularly fast-growing region, while an abundance of projects in Ivory Coast implies a high demand for cement in the West African country, Mokate Ramafoko, PPC’s head of Africa operations, said in the same interview. While he and Claassen declined to identify specific markets PPC will expand into, Ramafoko said Kenya had a shortage of cement clinker plants and Uganda also looked promising, with a new project coming up.

The plan marks a step change in the strategy of PPC, which raised 4 billion rand from shareholders in 2016 to service debt after S&P Global Ratings cut its credit rating to junk. That came during a perfect storm of heavy investment in new projects and slowing economic growth and falling prices in its home market, which accounts for about 70 percent of sales.

‘Construction Site’
Looking ahead, the company sees the potential for growth, both at home and internationally, as it seeks to repay shareholders for the faith shown during the rights issue.

“There’s an emergence of African leaders that are really starting to change the continent,” said Ramafoko. New presidents of countries including South Africa, Ghana and Zimbabwe are all in the process of approving new infrastructure projects that benefit cement makers, while the Ethiopian capital of Addis Ababa is “a construction site,” he said.

Ongoing infrastructure projects include a a 1.4 billion euro ($1.7 billion) urban-railway project in Ivory Coast, while Zimbabwe plans to widen the highway that links the capital Harare to South Africa, which heavy duty trucks use to transport everything from power-plant equipment to minerals such as chrome and copper.

Of all the new plants, generating a return from the Democratic Republic of Congo facility has proven the most challenging. PPC has negotiated a “debt holiday” with lenders after the market “didn’t pan out as envisaged,” Claassen said. There’s an over supply of cement in sub-Saharan Africa’s largest country, and PPC is in talks with China National Materials Co., known as Sinoma, about selling a stake in the Congo operation.

Congo Sale
“They are quite amenable in taking a majority stake,” Claassen said, adding that the outcome may depend on merger talks between Sinoma and local rival China National Building Material Co., which would create the world’s largest cement maker. “We are not married to Congo, but we would need a fair price for what we invested.”

PPC spent much of last year in merger talks with local rival AfriSam Group Pty Ltd., which teamed up with Canadian insurer Fairfax Financial Holdings Ltd. to try and push through a deal. PPC considered Fairfax’s 5.75 rand-a-share offer for a minority stake in a proposed PPC-AfriSam combination as too low, and a string of other rivals, including LafargeHolcim Ltd. and Dangote Cement Plc, walked away after considering an approach.

The shares climbed 1.9 percent to 7.90 rand at the close in Johannesburg on Friday, valuing the company at 12.6 billion rand. They have gained 13 percent this year.

There’s still scope for consolidation in South Africa, Claassen said, with competitors including Sephaku Cement, part of Lagos, Nigeria-based Dangote’s operations, and Mamba Cement as well as AfriSam. He declined to comment on whether PPC-AfriSam merger talks could be revived.

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What you need to study to become a millionaire in South Africa

SOUTH AFRICA (businesstech.co.za) – Global market research group New World Wealth has released its latest South African Wealth Report, looking at the trends among the country’s wealthiest people.

The report found that South Africa is home to 43,600 High Net Worth Individuals (HNWIs) – defined as individuals who have net assets of $1 million or more.

Additionally South Africa is home to 2,200 multimillionaires (net assets of $10 million or more), and 5 billionaires with net assets of $1 billion or more.

The average age of HNWIs in South Africa is 57 years, slightly above the worldwide average. However South Africa is also home to a large number of young millionaires with those aged 40 and under accounting for 29% of the total make up.

The largest portion of South Africa’s HNWIs acquired their wealth through the financial and professional services (including banks, law firms, accountants, fund managers and wealth managers), however this is closely followed by the real estate and construction industry.

The financial and professional services industry was also the fastest growing sectors for South African HNWIs over the past decade.

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Ex-South Africa leader is defiant as corruption case starts

SOUTH AFRICA (washingtonpost.com) – Former South African president Jacob Zuma sat in the dock of a packed courtroom on Friday to face corruption charges and emerged defiant, telling supporters that the case against him was politically motivated.

Zuma, 75, appeared relaxed during the brief hearing at which his case was adjourned until June 8. While a lengthy court battle is expected, the spectacle of Zuma appearing before a judge less than two months after his resignation was a victory for opposition figures and activists who have fought for years to call him to account.

Sixteen charges of fraud, racketeering and money laundering were recently reinstated after being thrown out nearly a decade ago. They relate to an arms deal in the 1990s, when Zuma was deputy president. The case fueled the public anger that finally forced Zuma from power in February, though other scandals hurt him and the ruling African National Congress party that eventually instructed him to resign.

At the hearing, Judge Themba Sishi said Zuma was free “on warning.” He could face several years in prison.

State prosecutor Billy Downer suggested that Zuma’s trial start on Nov. 12, though a lawyer for Zuma said the defense would not agree to any trial date for now. In the meantime, the defense is expected to challenge a decision by the National Prosecuting Authority to reinstate charges against the former president.

Outside the courthouse, Zuma sang and swayed on a stage before a large group of supporters, many sporting regalia of the ANC party.

He told the crowd that he was the victim of a political vendetta and that he has campaigned for the economic rights of South Africa’s black majority since the end of apartheid in 1994. The message resonates among many people who resent the fact that much of the economy remains in the hands of the white minority despite the advent of democracy.

The court hearing occurred in the coastal city of Durban in Zuma’s home province of KwaZulu-Natal province, a stronghold of his support.

“Hands off Zuma,” his backers chanted.

Also in the dock was a representative of Thales, a French defense company accused of paying bribes to Zuma in the arms deal.

Zuma’s financial adviser at the time, Schabir Shaik, was convicted of corruption in the case in 2005 and sentenced to 15 years in prison. He was released after two years on medical parole.

Zuma was replaced as president by his deputy, Cyril Ramaphosa, who has promised a robust campaign against corruption and seeks to rebuild a ruling party whose moral stature has diminished since taking power at the end of apartheid.

In another scandal linked to Zuma, South African authorities seek to arrest members of the Gupta business family, which allegedly used its connections to Zuma to influence Cabinet appointments and win state contracts.

Also, South Africa’s top court ruled in 2016 that Zuma violated the constitution following an investigation of multi-million-dollar upgrades to his private home using state funds. He paid back some of the money.

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This is how many millionaires live in South Africa right now

SOUTH AFRICA (businesstech.co.za) – New World Wealth has published its South African Wealth Report for 2018, showing how wealth trends have shifted among the country’s richest people.

According to the report, South Africa is currently home to 43,600 high net worth individuals (HWNIs) – people who have total wealth higher than $1 million – at the end of 2017.

This is up from the 40,400 recorded at the end of 2016, and climbing from the 38,500 recorded in 2015, when millionaire growth declined to levels last seen in the middle of the global economic crisis of 2008.

HWNI growth in 2017 was in-line with overall wealth growth in South Africa, where total private wealth increased from $670 billion at the end of 2016 to $722 billion at the end of 2017.

Of this, HWNI wealth rose from $284 billion to $306 billion, staying at 42% of total private wealth.

South Africa HWNI stats at the end of 2017

Total private wealth held in SA amounts to approximately US$722 billion. Around US$306 billion of this is held by HNWIs.
The average South African individual has net assets of US$12,900 (wealth per capita), which is the second highest level in Africa, behind Mauritius.
SA is home to 43,600 HNWIs, each with net assets of US$1 million or more.
SA is home to 2,200 multimillionaires, each with net assets of US$10 million or more.
SA is home to five billionaires, each with net assets of US$1 billion or more.
The growth was supported by a strengthening rand (moving from R13.70 against the dollar to R12.20 by year end) and the JSE all share index gaining significantly – 30% in dollar terms.

However, the picture changes when looking at HWNI growth over a 10 year period.

Between 2007 and 2017, the number of dollar millionaires in South Africa only grew by 2%. While this takes into account the global crash in 2008, and the slow recovery thereafter – the political crisis of 2015 and 2016, where the Zuma government wreaked havoc on the economy, has also played a significant part more recently.

The 10 year-review was negatively hit by a depreciating rand (which slipped from R6.90 in 2007 to R12.30 at the end of 2017), a sluggish property market, and a poor performance from key sectors, especially mining, New World Wealth said.

On the flip-side, the JSE all share index increased by 17% over the period, while there was strong growth in the professional services sector, and the MSCI World Index grew by 43% – because many local HWNIs are invested overseas.

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According to New World Wealth, over the next 10 years, HWNI growth in South Africa is forecast at 28% – on the back of recent, more positive political changes – expected to reach 56,000 dollar millionaires by 2027.

Supporting this growth is a well-developed wealth management, fund management and banking system, as well as a large, free media that helps investors by feeding them reliable information, New World Wealth said.

The country is also home to one of the 20 biggest stock exchanges in the world – the JSE – which is also one of the fastest-growing over the past 25 years, in terms of market capitalisation.

While other countries are starting to catch up, South Africa remains an important hub for doing business in Africa, the group said.

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SA most unequal country in world: Poverty shows Apartheid’s enduring legacy

SOUTH AFRICA (timeslive.co.za) – South Africa is the most unequal country in the world. This is according to a new report by the World Bank that listed 149 countries.

The report analysed South Africa’s post-apartheid progress‚ focusing on the period between 2006 and 2015.

The report found the top 1% of South Africans own 70.9% of the country’s wealth while the bottom 60% only controls 7% of the country’s assets.

Neighbours Namibia and Botswana were second and third.

Zambia‚ Central African Republic‚ Lesotho‚ Swaziland‚ Brazil‚ Colombia and Panama completed the top 10.

More than half of South Africans (55.5%) or 30-million people live below the national poverty line of R992 per month. This number increased since 2011.

The groups worst affected by poverty are black South Africans‚ the unemployed‚ the less educated‚ female-headed households‚ large families and children.

The official unemployment rate was 27.7% in the third quarter of 2017 while youth unemployment was 38.6%.

The report found poverty has a “strong spatial dimension” which demonstrates the enduring legacy of apartheid.

“Poverty remains concentrated in previously disadvantaged areas‚ such as the former homelands.”

Former head of the African Union Nkosazana Dlamini-Zuma said in the report that inequality remains “stubbornly high”.

“South Africa as one of the most unequal countries in the world‚ with consumption inequality having increased since 1994. Wealth inequality is high and has been rising over time. A polarised labour market results in high wage inequality.”

World Bank South African director Paul Noumba Um said: “South Africa has a dual economy where on the one hand is a small high-skilled‚ high-productivity economy and on the other hand‚ a large low-skilled‚ low-productivity one.”

World Bank southern Africa economist Victor Sulla told NPR: “The people at the bottom in South Africa‚ they get wages comparable to the people who live in Bangladesh. It’s very‚ very poor.”

He added: “If you take the top 10%‚ they live like in Austria. So it’s a very high level even by European standards or even by U.S. standards. And we are talking just about employees‚ people who are getting paid. And not the super-rich who are earning income from factories or property or other investments.”

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South Africa hails ‘retraction’ of Australian minister’s offer to white farmers

SOUTH AFRICA (The Guardian) – The Australian home affairs minister, Peter Dutton, has denied that the Australian government retracted his offer for white South African farmers to come to Australia on humanitarian visas.

A spokesperson for Dutton reportedly issued the denial after the South African government claimed Australia had gone back on plans to offer fast-track humanitarian visas to “persecuted” white farmers.

The difference of opinion suggests Australia has attempted to smooth over offence caused by Dutton but will still consider white South African farmers for humanitarian visas, despite the United Nations high commissioner for refugees warning that refugees should be prioritised.

Dutton triggered outrage in March when he said the farmers deserved “special attention” for visas to Australia on humanitarian grounds.

He said the home affairs department was examining options to enable the farmers to flee their “horrific circumstances” for a “civilised country”.

His offer was in response to a pledge by the South African government to enact land expropriations without compensation to redress the land confiscations of the colonial and apartheid era.

The Australian prime minister Malcolm Turnbull and foreign minister Julie Bishop both appeared to publicly contradict suggestions of “special attention” by stressing the non-discriminatory nature of the humanitarian visa program. However, neither explicitly rejected the claim South African farmers would qualify.

The South African government said it was offended by Dutton’s call and demanded a full retraction from Australia.

“We have received a letter from the [Australian department of] foreign affairs that indicated that what was said by the minister of home affairs is not the position of the government of Australia,” a South African foreign ministry spokesman, Ndivhuwo Mabaya, said on Monday.

“We also had a meeting with the high commissioner who conveyed a message from the prime minister, who said the same thing, to indicate that this is not the view of their government.”

South Africa’s foreign minister, Lindiwe Sisulu, claimed the Australian prime minister, Malcolm Turnbull, and foreign minister, Julie Bishop, had made a “retraction” of Dutton’s comments, and she welcomed it.

“We must emphasise, as we have stated before, that no one is being persecuted in South Africa, including white farmers,” she said. “We call upon all non-governmental organisations to desist from spreading untruths and misleading information.

“South Africa is a law-abiding country and, through a constitutional process, it will arrive at solutions on land redistribution that will take the country forward without violating anyone’s rights.”

On Tuesday a spokesperson for Dutton reportedly told Sky News the statement “does not accurately reflect the prime minister or minister for foreign affairs position on this matter”.

“There was no rebuttal of the words of minister Dutton,” he said.

In March Dutton’s call was supported by the former prime minister Tony Abbott and prompted a group of seven MPs in the ruling Coalition parties to raise the matter in the party room.

Concerns were expressed white South African farmers may not qualify as refugees, even if they left South Africa, because of the possibility they could move to cities in the country and be free of persecution.

But the party room was assured Australia could still grant humanitarian visas. MPs were told applications, including from referrals in Australia, will be considered.

Bishop stressed the consistency of her stance with Dutton’s because both agree that South Africans would qualify under existing humanitarian visa rules.

Land is a hugely divisive topic in South Africa, where 72% of individually owned farms are in white hands 24 years after the end of white-minority apartheid rule.

By contrast just 4% of such land is owned by black people, according to an audit cited by President Cyril Ramaphosa.

According to police, 74 farmers were murdered between 2016 and 2017 in South Africa, which has one of the world’s highest crime rates.

Up to 500,000 white South Africans have left the country in the past 30 years, according to official statistics. Australia is the most popular destination for relocation.

 

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Online retail trends in South Africa

SOUTH AFRICA (Media24) – After a few years hovering around the 1% mark, Spree predicts online shopping’s share of total retail sales in South Africa will increase exponentially over the next three years, rising to about 4% by 2021.

Barriers to entry such as lack of internet access and limited online payment methods are being overcome. There are also improvements in the experience and convenience of online shopping that will draw shoppers online.

In mid-2017, total sales at Spree were up 88% year-on- year, sales on the shopping app more than doubled and daily transactions increased by 76%. If this growth continues and is mirrored by other players we will see online retail gaining serious ground and growing market share measurably over the next couple of years.

Globally, online retail currently stands at 11% of all retail sales with China coming in well over 20% and large markets such as the UK and Germany standing at 18% and 11% respectively. This is according to the Centre for Retail Research, Emarketer and Internetretailer.

Barriers have fallen

New research from #AfterAccess showed that 55.5% of South Africans now have a smartphone – and this figure is rising steadily. The connectivity gap is no longer a major barrier. Many South Africans leapfrogged the desktop stage straight to mobile so the growing penetration of smartphones is likely to deliver a big boost for online retail. Technological advancements and our increasingly digital lifestyle also help to break down barriers such as lack of trust in delivery and payment, as multiple digital payment options (and even digital credit) are now being offered.

Shopping is increasingly about personalisation, with machine learning building up a psychographic profile of every customer at a granular level and suggesting products accordingly. Media24’s Spree has already led the way locally with the introduction of a fashion image search feature. This functionality allows shoppers to upload a photo in the Spree app, which then suggests visually similar items.

Essentially, machine learning serves customers looks they will love. Once shoppers get used to this feature they’ll grow impatient with the shop-to- shop mall walk quickly. This technology, along with improved online search functionality through voice (think Alexa), will extend beyond clothing and will help shoppers find the best possible skincare products as well as other items such as homeware, sportswear and even groceries.

Faster delivery time

In the US, drone deliveries and smart distribution tech are already reducing a three-day delivery time to three hours. Next to faster and more accurate deliveries, we’re likely to see at least some local deliveries arriving by drones in 2021.

Since South Africans have a penchant for instant gratification, faster delivery times are likely to speed up the uptake of online shopping as shoppers know that their purchases will arrive very soon after the order is placed. There is a huge correlation between speed to customer and revenue growth.

Malls will embrace digital

South Africans love a mall outing – it is part of our national DNA. As a result, South Africa has an oversupply of malls – 1 950 of the 2 082 shopping centres in Africa are in SA, according to Dion Chang’s Flux Trends Report. Based on this, we know the mall will still be alive and well in two years’ time, but the way we shop there is likely to evolve as physical and online shops increasingly work in tandem. More and more shops in malls will be shop fronts with limited stock – essentially more a brand presence than a store. Shoppers will browse there but want to buy online. This will mean that even mall shoppers will be making purchases online, demystifying the process. Soon they may no longer feel the need to go to the mall at all.

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Self-testing kits and vending machine drugs are helping South Africa’s battle against HIV

SOUTH AFRICA (thejournal.ie) – SELF-TESTING KITS and vending machines distributing prescription drugs are two ways that HIV treatment is being automated to reduce stigma in South Africa, home of the world’s biggest HIV epidemic.

With 7.1 million people living with HIV in the country, removing human intervention is helping experts target hard-to-reach groups like young men who are often reluctant to queue in public clinics.

Students, porters and labourers have flocked to a new HIV self-testing stand outside a supermarket in Hillbrow, a gritty district of central Johannesburg.

The project was started in Malawi, Zambia and Zimbabwe in 2015 and expanded last year to include South Africa, which has an 18.9% HIV rate among adults.

A small team of young and stylishly-dressed “peer educators” convince men aged between 18 and 30 to take the tests, which – in a breakthrough for South Africa – are self-administered.

“It’s targeted at young men and if we have a group of young men around, we pull more people in,” said Lynne Wilkinson, an expert at the University of the Witwatersrand Reproductive Health and HIV Institute, which oversees the project.

From May, the scheme will be extended to several of Johannesburg’s bustling minibus taxi ranks which carry hundreds of thousands of commuters every day.

After passers-by complete a simple form, they are handed a pack to take into one of a row of unassuming portable pop-up tents to ensure privacy.

‘Did it to inform myself’

They follow a short guide showing how to swab their gums with a wand before placing it into a holder.

“Instructions are in six languages and most of the time people do it right,” said Mokgadi Mabuela, a confident 25-year-old, who distributes and demonstrates the tests.

After 20 minutes, the test results are delivered by lines that indicate negative or positive.

Those showing positive are offered immediate confirmation tests which, if conclusive, are followed-up with treatment referrals.

Those not wanting to wait for their results can take the packs home.

“Last week I came past with my brother who tested and I was passing by today. It was easy and I did it to inform myself,” said one young man, who declined to be named.

The kits, which are free to the users, contain advice on what to do if a home test is positive.

The project is an initiative of Unitaid, the Geneva-based organisation that says three out of every 10 people with HIV worldwide do not know they have the virus.

It has so far brought hundreds of thousands of the tests into South Africa and surrounding countries and plans to distribute 4.8 million self-screening kits in total.

One of those who tested positive after self-screening was 45-year-old musician Oscar Tyumre from Alberton, east of Johannesburg.

“With their counselling, they advised me to go to their clinic to take their medication right away,” he told AFP.

“I was delicate at the time – but I started right away.”

‘Know your health status’

Oscar added that knowing his status was actually a relief.

“My advice is don’t despair. It’s not the end of the world, you can go straight into treatment and still live to 100,” he said.

Ten kilometres north, in the sprawling Alexandra township, South African not-for-profit Right ePharmacies last week launched an ATM-style dispenser that removes the need for face-to-face interaction with a pharmacist to collect HIV treatment.

Patients can activate the vending machines – the first in Africa – using a membership card and PIN number which calls up repeat prescriptions pre-loaded by doctors.

Law requires a live pharmacist sign off on the transaction so after a Skype-like video call, the medication is dispensed. It takes less than five minutes.

“It’s much easier and quicker,” said Alexandra resident Philda Dladla, aged 59, who uses the machines to collect HIV treatment twice a month.

“Before, we used to wait for the whole day at a clinic. It’s easy and anyone can do it — as long as you don’t forget your PIN number!”

The system’s privacy booths also mean patients can avoid publicly revealing their condition – unlike in busy local clinics.

“The only way anyone would know your health status is if you left with the medication showing,” said operations manager Thato Mathabathe beside one of the pharmacy’s four €137,000 German-made robotic dispensers.

Roughly 200 patients use the system every day and users have collected 16,000 items, including HIV/AIDS drugs as well as diabetes, epilepsy, asthma and hypertension medication since September.

There are now plans to expand it to three other sites in the Johannesburg region.

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The fake news campaign that tried to divide South Africa

SOUTH AFRICA (DANIEL VAN BOOM) – June 19, 2017, a news site in South Africa runs a story. It’s no normal story.

“National Treasury Sold to Johann Rupert,” reads the headline.

In a majority black country, Rupert, a white business magnate worth an estimated $7 billion, is the second richest man.

There was no evidence to support the explosive headline, but the story wasn’t retracted or corrected. It wasn’t designed to inform, it was designed to mislead. It was fake news.

The story was posted on WMC Leaks, one of many fake news sites making up an online network of misinformation. Behind the network: a trio of Indian businessmen known as the Guptas. The Guptas are infamous in South Africa.

Ajay, Atul and Rajesh “Tony” Gupta aren’t your regular family of businessmen. With close ties to former president Jacob Zuma and constant whispers of politicians in their control, the Guptas were increasingly at odds with a hostile public who saw them as the face of corruption in South Africa.

In a move reminiscent of Russian operatives looking to disrupt the US during the presidential election and the UK during the Brexit referendum, the Guptas in 2016 decided to use the power of the internet, and social media in particular. What ensued was a scandal that became part of the increasingly global issue of fake news.

The phrase may be synonymous with the US’ 2016 election, but fake news has caused concern in countries around the world. Many in Italy feared it would inform the country’s early-March election, for instance. Meanwhile, the US ambassador in Kenya said the country’s democracy is being undermined by fake news. The European Union said it found spikes in misinformation posted in Catalonia during its independence referendum last year.

In these cases, fake news campaigns focused on an election or referendum. South Africa’s fake news campaign was similarly political — it sought to protect President Zuma, but its real mission was broader in scope: improve the reputation of the Guptas, whose alignment to Zuma was strong enough that some of the public referred to the group as the “Zupta government.”

Through their Oakbay Investments company, the Guptas hired UK PR firm Bell Pottinger, allegedly paying it $2 million (24 million rand), to set up an online fake news campaign. The network went into effect around July 2016, working in full force for around a year.

Divide and conquer
The Guptas and their team got the message out with fake news sites and bots that shared stories from these websites, as well as retweeted Gupta-aligned political voices en masse. This worked in tandem with Gupta-owned TV and print media. All of it promoted one simple message to South Africans: You shouldn’t be worried about the Guptas, you should be worried about the white elite.

The campaign’s key phrase: “white monopoly capital.” Embedded in that phrase were two key components: The fact that South Africa’s economy is still dominated by white-owned businesses, and the argument that these businesses influence the government more than the Guptas do — and work to exclude the black majority from rising into affluence.

Here’s how the campaign was run, according to data from the African Network of Centers for Investigative Reporting (ANCIR).

Politicians and activists worked with the Guptas, either because they were paid to or because it was mutually beneficial to do so, to push messages online in support of Zuma, or disparaging those who opposed alleged Gupta corruption. Scores of bots were used to amplify these messages. Bots amassed over 215,000 retweets of Gupta-aligned voices from July 2016 to June 2017.

All of these messages were magnified with the help of ANN7, a 24-hour news channel, and the New Age newspaper, both owned by the Guptas.

Here the campaign ran differently from Russia’s meddling in US politics. Russian operatives stole or created identities to pose as Americans on Facebook and Instagram. The Guptas’ campaign, meanwhile, relied more on real people to make political statements, and used a swath of bots and their own official media channels to trumpet those messages.

One such voice, ANCIR says, is Andile Mngxitama. Mngxitama is president of Black First Land First, a revolutionary political party.

“Andile would tweet about white monopoly capital or would tweet a link to one of his fake stories, and the bots would retweet it as much as possible,” said Amanda Strydom, managing editor of ANCIR. “But Andile also had his little posse who would retweet what he had done or write their own tweets, so there were actually human people who would tweet, and the bots would be used to amplify whatever they tweeted.”

This was further bolstered by a set of news websites, set up with corresponding Facebook pages. These included Gupta-linked “alternative news” sites like Weekly Xpose and Mngxitama’s own Black Opinion, which resemble editorial-heavy propaganda sites, as well as completely phony ones like WMC Leaks, according to ANCIR.

“The stories [some sites] created were completely fabricated,” Strydom said, pointing to one of the sites posting photoshopped images of journalist Ferial Haffajee sitting on the lap of Johann Rupert in an attempt to slander her reports on government corruption.