South Africa’s economy given a shot in the arm
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SOUTH Africa’s stunted economy has received a much-needed boost as the government announced the easing of lockdown restrictions, the ramping up of Covid-19 vaccinations and the reinstatement of social support grants.
President Cyril Ramaphosa last night announced that the government had decided to place the country on alert level 3 from adjusted alert level 4.
This as the country has officially passed the peak of the third wave of Covid-19 infections.
Ramaphosa said the overall decline of new cases meant that it was possible to gradually ease some of the restrictions on gatherings, movement and the sale of alcohol.
South Africa recorded a total of 9 718 new Covid-19 cases and 287 deaths, with Gauteng still leading the pack followed closely by the Western Cape.
The average number of daily new infections over the last week was around 12 000 new cases a day, which represents a 20 percent drop from the previous week.
Ramaphosa warned that though the country had largely passed the peak of the third wave, there were areas of concern as the rates of infection had not yet shown signs of decline.
“The measures that we put in place for the past 28 days, alongside the continued adherence of South Africans to basic health precautions, have been effective in reducing the rate of infection,” he said.
Level 3 lockdown means that the sale of alcohol from retail outlets for off-site consumption will be permitted between 10am and 6pm from Monday to Thursday.
Non-essential establishments like restaurants, taverns, bars and fitness centres will also be opened but have to close by 9pm, before the start of the 10pm curfew.
Ramaphosa said interprovincial travel for leisure will also resume, and gatherings will be allowed but limited to a maximum of 50 people indoors and 100 people outdoors.
Ramaphosa also emphasised that the government needed to accelerate the implementation of the Economic Reconstruction and Recovery Plan by ramping up its vaccination roll-out.
More than 6.3 million vaccines have now been administered, with more than 10 percent of the population having received a vaccine dose.
The government will now allow people between the ages of 18 and 34 to be vaccinated from September 1 in addition to the age groups that are currently eligible.
South Africa is scheduled to receive around 31 million additional doses from Pfizer and Johnson & Johnson within the next two to three months.
Ramaphosa assured the country that there will be sufficient vaccine doses available for the rest of the year.
The government also reinstated the Social Relief of Distress Grant to provide a monthly payment of R350 until the end of March 2022 to support those who have no means of supporting themselves.
Ramaphosa also emphasised that more help for small businesses was on its way with a once-off business survival mechanism.
Businesses that had been affected by looting this month were covered by state insurer Sasria.
Further measures would be announced for those businesses that were not insured. Ramaphosa also emphasised that more help for small businesses was on its way with a once off business survival mechanism.
Old Mutual Investments chief economist Johann Els said it was positive that Alert level was reduced. “This will allow for more economic activity in services sectors, especially hospitality sectors, and alcoholic beverage industry. Plus, it will lift confidence,” Els said.
He added that the improvement in vaccination procurement and rollout was very positive. He said the reinstatement of special Covid grant would help better revenue but raised fiscal risks if not done in a fiscal neutral manner.
“All these measures are very positive for economic recovery, but fiscal risks are higher, although we need more detail,” Els said. “Fortunately, all these measures are linked to accelerated reforms. I expected the recent unrest to be an inflection point for faster economic reforms.”