S. African gov’t keen to restart as many economic areas as possible: minister

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A homeless person stands outside a temporary tent in Pretoria, South Africa, April 15, 2020. South Africa has provided temporary tents and food for the homeless to better control the COVID-19 outbreak. (Photo by Shiraaz Mohamed/Xinhua)
A homeless person stands outside a temporary tent in Pretoria, South Africa, April 15, 2020. South Africa has provided temporary tents and food for the homeless to better control the COVID-19 outbreak. (Photo by Shiraaz Mohamed/Xinhua)

The South African government is keen to “restart as many economic areas as possible “if the country can avoid a sharp increase in COVID-19 infections, Minister of Trade and Industry Ebrahim Patel said on Friday.

The government is taking responsible steps to deliberately reopen the economy in phases, Patel told Parliament’s two committees on trade and industry.

But this must be done with the safety of the South African people at the forefront in ways that allow livelihoods to be preserved, while protecting the productive assets of the nation and sustaining as much of the economy as it can, Patel said.

He was speaking as the country entered level four restrictions following five weeks of a level five lockdown. Under level four, about 1.5 million people are allowed to return to work in certain economic areas.

South Africa, Patel said, does not need to stay at level four for a specific number of weeks but can move rapidly to a lower level should risks be mitigated.

The initial return to work will be based on the national level and will progressively be expanded to provincial and district level, enabling workplaces to adapt to the level of infections and healthcare readiness in localities, according to Patel.

Should the country avoid a sharp increase in the levels of infections with the return to work of large numbers of workers and expanded testing and healthcare facilities, the economy could shift to level three as soon as possible, Patel said.

He emphasised that the COVID-19 pandemic will impact the South African economy in deep ways due to the closure of many companies during level five restrictions.

“Work is still underway to establish the extent of the impact,” he said.

The estimated impact on the economy varies at the moment, and will be driven by the trajectory of the virus both in South Africa and globally, said Patel.

The International Monetary Fund (IMF) estimates that South Africa’s gross domestic product (GDP) will fall by 5.8 percent in 2020.

Patel said the stimulus package worth 500 billion rand (about 26.6 billion U.S. dollars) announced by President Cyril Ramaphosa last month is not an elitist package as it includes the Unemployment Insurance Fund, which is an “absolute lifesaver” for low-level paid workers.

Duma Nkosi, Chairperson of Parliament’s Portfolio Committee on Trade, Industry and Competition, said his committee commends the responsible and decisive manner in which the government is dealing with the COVID-19 pandemic.

“We know that the lives of our people come first, and we will be guided by this principle. At the same time, we recognize the difficulty in the balancing act of keeping our people safe and reopening the economy, as these are interlinked,”he said.

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