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A national rescue effort to save thousands of lives threatened by the spread of Covid-19, while trying to preserve and reconfigure the economy, is unfolding on a scale unprecedented in democratic South Africa.
The depth of the crisis the country is in was underscored by a series of disastrous events on Tuesday, with the rate of coronavirus infection seeing its highest increase in recent weeks, with 143 South Africans more positive, bringing the total to 2 415.
READ | SAs unlikely to prevent spread of Covid-19 ‘forest fire’, but blockade bought time
And a series of economic forecasts also stopped working, as the SA Reserve Bank predicts that GDP will contract 6.1% in 2020 and Business for South Africa, the body that coordinates the response to the virus by Organized companies, expecting a contraction of between 8% and 10%, with a million jobs possibly lost.
“At this stage, our central stage is a deep recession in 2020 followed by an upturn in economic growth,” Finance Minister Tito Mboweni said during a conference call with journalists.
Also on Tuesday:
- SA Reserve Bank unexpectedly lowered the repurchase rate by 100 basis points to bring the prime rate to 4.25%.
- Mboweni announced that he would take a series of measures to aid economic recovery and structural reform to the cabinet on Wednesday.
- Business for SA confirmed that the design of a locally manufactured and medically approved fan will be made public in a few days.
- A Chinese cargo plane with medical supplies, including urgent stocks of personal protective equipment, landed in Johannesburg.
- But a series of briefings between Sunday and Monday have revealed the scale at which the government’s response to the virus has been increased by the efforts of the academy and the private sector.
Lesetja Kganyago, the Governor of Banco de la Reserva SA. (Media24 files).
Within 24 hours, the head scientist of the government, Professor Salim Abdool Karim, the governor of the Reserve Bank Mboweni, SA, Lesetja Kganyago, and organized businesses, represented by a new umbrella organization called Business for SA, announced a series of initiatives and plans to mitigate the destructive impact of coronavirus on public health, the economy and livelihoods.
The CEO of the Rothschild and Co financier in South Africa, Martin Kingston, one of the coordinators of the Business for SA initiative, said that organized businesses were in constant and “dynamic” contact with the government, including President Cyril Ramaphosa and several ministers.
“There is a government receptivity to our proposals. There are unprecedented levels of cooperation and collaboration between the government and the private sector at this time of need,” he added in a briefing on Tuesday morning.
Furthermore, Mboweni, in another briefing on Tuesday, said that he and Kganyago spoke “at least four times a day” about Covid-19’s impact on the economy, the country’s fiscal position, possible job losses, and efforts to keep the economy alive. .
And on Sunday, Abdool Karim, an expert in immunology and infectious diseases with academic chairs at universities such as KwaZulu-Natal and Harvard, was confirmed as the lead scientist at the head of a ministerial advisory group that provides data to Health Minister Zweli Mkhize.
This advisory group, consisting of 45 experts working in four subcommittees, meets almost daily to assess the evolution of the health crisis.
Professor Salim Abdool Karim, Chairman of the Ministerial Advisory Group on Covid-19. (Media24 files).
Kingston told reporters that the Business for SA initiative consisted of seven lines of work working closely with the government, including health care (which is driving the national fan project), economic interventions (along with the National Treasury, the Bank de la Reserva SA and the Department of Commerce and Industry) and labor. (as part of the Nedlac queries).
He added that the country would have no choice but to “aggressively restructure the economy” after the virus disappears. “Less than 50% of the economy is working, and 60% of small and medium-sized businesses have started or are considering retiring. This represents more than six million people.”
Both Mboweni and Kganyago, in consecutive calls with reporters, said they expected the coronavirus to have a severely debilitating effect on the economy.
The finance minister said he would take a series of proposals to “revitalize” the economy to the cabinet on Wednesday, calling it “a big agenda item” and saying he would personally announce the decisions made by the national executive later.
President Cyril Ramaphosa with Martin Kingston, the CEO of Rothschild and Co in South Africa and coordinator of Business for South Africa. (Media24 files).
Mboweni added that the Treasury had been working on three scenarios, including one with projections on the impact of a “prolonged” blockade.
“We have to start thinking about making the economy move after April. But any decision we make must be based on risk. We need to start the economy, but it will not help if we do it too soon … our decision must weigh risk.”
He said South Africa would seek help from international financial institutions, including a possible $ 60 billion loan from the World Bank. The country will consider all options, including in an emergency, the specific installation Covid-19 of the International Monetary Fund.
Mboweni has instructed that prioritization of funds across the national budget should be carried out to ensure the flow of money to programs where it is most urgently needed, including and primarily the Department of Health.
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