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July Unrest: KwaZulu-Natal businesses have both optimism and anxiety, one year later

Despite the setbacks, the Durban Chamber of Commerce and Industry (DCCI) said it believed businesses were committed to rebuilding.

File Picture: People loot goods from a warehouse in Durban in July last year. The looting and unrest caused billions of rand in damage. | EPA-EFE

Published Jul 8, 2022

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Durban - As the province marks a year since the July unrest which brought about destruction for businesses across KwaZulu-Natal, the business sector has expressed both optimism and anxiety.

KZN businesses, particularly in Durban and Pietermaritzburg, have been reeling from the challenges brought on by the Covid-19 pandemic, unrest and most recently the April floods.

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Despite the setbacks, the Durban Chamber of Commerce and Industry (DCCI) said it believed businesses were committed to rebuilding.

Nigel Ward, president of the DCCI, said it was now evident that the extent of the damage the city suffered and the financial economic loss as a result of the unrest was truly shattering, with close to R12.8 billion worth of damage caused.

He said a survey conducted by the city of eThekwini with the Durban Chamber’s assistance revealed the following statistics after the unrest:

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♦ Value of lost sales and stock – R40bn.

♦ Cost of damage to property – R15bn.

♦ Cost of lost equipment and machinery – R20bn.

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♦ Jobs at risk – 9 100.

Ward said all economic sectors were hard hit.

“However, the tourism and manufacturing sectors have been worst affected. Many of these sectors are dependent on reliable infrastructure, and on the inflow and outflow of tourists to sustain their operations. The Covid-19 pandemic, the July unrest and the recent April floods restricting travel, meant tourists were not able to travel. Furthermore, the April floods derailed some of the country’s largest manufacturers.

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“Despite all this, we are optimistic that KwaZulu-Natal’s economy is on the road to recovery – each day we take a step closer. Based on our observation, some businesses have started rebuilding, with some already operating at full capacity, while others are still in the process of rebuilding. Following engagements with our colleagues in the private sector, we believe business leaders are committed to rebuilding their operations in Durban.”

Ward said certain measures needed to be taken to guard against any repeat of the unrest, including law enforcement taking a more proactive approach to prepare for these type of incidents, and government working with the business community on safety and security.

“The DCCI strongly believes that the government, together with law enforcement, need to take a firmer approach when tackling unlawful situations.

“Accountability needs to be taken and we need to see criminal unlawful behaviour being punished to avoid history repeating itself. Government needs to work with the business community to find collaborative, proactive and sustainable solutions.”

Pietermaritzburg, and Midlands Chamber of Business CEO Melanie Veness said the city may never fully recover from the effects of last July.

Veness said Pietermaritzburg had been hit hard by the unrest, with stores across the CBD, warehouses and shopping malls targeted.

As the rebuilding efforts continue, the chamber CEO said there was anxiety among many in the business community, and this was affecting the local economy.

“I think it is fair to say the economy is struggling to recover because of hesitancy to invest, partly because of a loss of confidence post the July unrest.”

She added that following the unrest, many investors had looked to other parts of the country in order to do business.

“Some businesses have fully reopened. Some small businesses have not been able to reopen, others are struggling to achieve pre-unrest levels of operation. Still others have chosen to keep part of their businesses open here and to test operations in other localities.”

Veness noted that while some facilities that were destroyed were still being constructed, the KZN capital had lost some stores and warehousing to other provinces.

Businesses that had opted to look to house their operations elsewhere were primarily in the manufacturing sector, with Gauteng and even Lesotho benefiting at Pietermaritzburg’s expense.

She said one of the harsh lessons learned from the looting spree was the need to improve security, with many malls investing substantially in it.

She added that things were made even tougher in Pietermaritzburg due to its crumbling infrastructure.

“The danger of this is that if operations in the other locations turn out to be more feasible, we’ll see further disinvestment as operations slowly move across to the new locations.”

According to Veness, while the chamber had been aware of the pledges from government departments, they could not ascertain whether businesses had been assisted. | Additional Reporting Mercury Reporter

THE MERCURY

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