Smarter lockdown could be on the cards to prevent economic meltdown

Warnings of the devastating effect of the lockdown on the country’s economy and the country’s poor have been coming from all directions and is starting to reach a crescendo. Business leaders have called on the Government for a further easing of restrictions amid warnings that the economy could shrink by at least 17% and that as many as four million jobs could be lost. Panda, a multidisciplinary initiative spearheaded by actuaries, estimated that South Africa’s lockdown will cause 29 times more deaths in the long run than the pandemic and that poverty could be a bigger killer. Bloomberg reported that 1 million people in Johannesburg, described as “Africa’s wealthiest city” were needing food aid. President Cyril Ramaphosa is also running the risk that the goodwill that he enjoyed at the beginning of the outbreak of Covid-19 and the buy-in that he enjoyed from the country’s citizens is diminishing fast as some of the measures including the ban on the purchase of cigarettes and alcohol, and the actions of his security forces are perceived to be too draconian. Even former cabinet minister Trevor Manuel has spoken out against the removal of freedoms during the lockdown. And it seems there are signs that the Government is starting to listen and is according to Bloomberg sources considering an easing of the lockdown. – Linda van Tilburg

Economic carnage spurs South Africa to consider easing lockdown

By Paul Vecchiatto, Loni Prinsloo and Mike Cohen

(Bloomberg) – South Africa’s National Command Council, the body overseeing the government’s response to the coronavirus crisis, is considering easing lockdown rules more rapidly as the economy tanks and poverty levels soar, according to three senior officials with knowledge of the talks.

Curbs could be relaxed in some provinces or areas with low infection rates, and retained in hotspots such as Cape Town, according to two of the officials who spoke on condition of anonymity because they aren’t authorised to comment. While one official said a decision is likely to be taken within 10 days, another said no timeline had been set for adjusting the lockdown level.

Africa’s largest economy was brought to a near standstill on March 27 as the government sought to buy itself time to prepare the health system to cope with a massive influx of coronavirus patients. While restrictions were eased from May 1, many businesses remain partially or completely closed, job losses are mounting and the central bank has warned that the economy could shrink 6.1% this year.

The current restrictions are unworkable for many firms, according to Busi Mavuso, the chief executive officer of lobby group Business Leadership South Africa.

“Some companies simply can’t open with 50% of their staff – there are complex production lines that either all operate or none at all,” she said in a weekly newsletter on Monday. “Others can’t function because they might be deemed able to open, but key suppliers are not, so they cannot access inputs to restart production.”

South Africa has Africa’s highest number of diagnosed coronavirus infections. Of the 11,350 cases detected so far, 97% have occurred in four of the nine provinces, with Cape Town and the surrounding Western Cape province accounting for 54%. The numbers may be skewed by varying testing and screening approaches and capability.

The government is still reviewing its virus response, according to Health Minister Zweli Mkhize.

“There are very different stages that different parts of the country are in,” he said in a televised address. “There are areas that have shown no new patients, no new cases, and therefore we have to approach the issues and levels very differently.”

Nonceba Mhlauli, a spokeswoman for Minister in the Presidency Jackson Mthembu, declined to comment. Khusela Diko, a spokeswoman for President Cyril Ramaphosa, didn’t immediately respond to questions seeking comment.

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