11 Covid-19 deaths; SA economy faces war-time style contraction; car sales hammered; KFC property defaults

By Jackie Cameron 

  • The total number of confirmed COVID-19 cases was 1,655 as of Monday 6 April, with 11 deaths reported to SA authorities. This is an increase of 70 from the previously reported cases, with Gauteng reporting the highest number, at 704, and the Western Cape at 454. The two recently reported deaths are of elderly people in their 80s who have been in hospital since the end of March.
  • South Africa’s economy could contract by 2% to 4% and the budget deficit could be pushed to war-time levels, the Reserve Bank says. The monetary policy committee projected in March that the economy will contract by 0.2%, but that was before the lockdown was announced, reports Bloomberg. South Africa’s economy is stuck in its longest downward cycle since World War II, with rolling blackouts and poor business and consumer sentiment weighing on growth. Uncertainty and downward shocks to economic prospects posed by the coronavirus mark “an inauspicious start to a new decade after the serial disappointments of the 2010s,” the central bank says. The budget deficit could exceed 10% of GDP this fiscal year, says Bloomberg. “The largest shortfall on record was 11.6% of GDP in 1914, followed by 10.4% in 1940, according to the central bank.”
  • BMW says all major markets experienced double-digit declines in March and extended factory halts across Europe, North America and South Africa by 10 days until the end of the month. BMW AG delivered a fifth fewer cars in the first quarter while overall auto sales in the UK plummeted 44% in March, adding to growing evidence of how the coronavirus pandemic is pummelling the global auto industry, reports Bloomberg.
  • KFC-owner Yum! Brands Inc. has told landlords in South Africa that the US firm won’t be paying rent while outlets are closed during a three-week government-enforced lockdown to contain the coronavirus pandemic, says Bloomberg. “The decision relates to 48 company-owned stores in the continent’s most industrialized country, a spokeswoman for KFC South Africa said in emailed comments. The remainder of the 1,145 KFC fried-chicken restaurants across Africa are operated by franchisees who are making their own arrangements,” she told Bloomberg.
  • South African telecoms regulator ICASA announced on Monday an emergency release of broadband spectrum to meet a spike in internet demand during a lockdown to tackle the coronavirus pandemic, reports Reuters.“The emergency release of this spectrum does not … negate the processes that are currently underway for permanent assignment of spectrum through an auction, the process which the Authority had committed to finalise by the end of 2020,” said the Independent Communications Authority of SA (ICASA) in a statement.
  • UK Prime Minister Boris Johnson, who is struggling to shake Covid-19 and has been hospitalised, has tweeted that he is in good spirits and is still working remotely. Bloomberg says that Johnson’s illness deals a blow to the UK, as the country prepares for the worst of the pandemic to hit. “Almost 5,000 people have died from Covid-19 in the UK so far and, according to government advisers and scientists, the peak is likely in the next 7-10 days.” Europe’s worst-hit countries reported declines in deaths, with the latest data from Spain, Italy and France suggesting measures that have halted economies and forced people to stay home are having an effect, says the news agency. “But while the rise in fatalities also slowed in the UK, Britain is behind other nations in the infections curve and is struggling to ramp up testing,” it notes.