18/05/2020 | By Busiswe Mavuso
I have every sympathy for the challenges government is facing on multiple fronts in dealing with this crisis. There is a great deal of uncertainty both on the medical issues and the economic fallout.
But criticism of government policy had, until recently, began to mount, including my own on some aspects of the lockdown approach and general economic response. Further voices have arisen on the health side, with some prominent scientists directly involved in advising government publicly complaining that their advice is not being followed.
My own sense is that a level of cynicism and frustration had spread across the country. People were angry about what they perceived as completely arbitrary regulations that have no impact on the virus and its progression. From banning cigarettes to listing what counts as winter clothing, public trust was being shaken that government really was acting rationally and in the best interests of the people.
Which is why the president’s speech last week was important. He did not announce any specific changes to the lockdown regulations or other interventions but he did convey a genuine openness to learn and change course in response to the evidence. “Some of the actions we have taken have been unclear, some have been contradictory and some have been poorly explained and some have evoked a lot of anger and opposition in many of you,” he said. Those words were a powerful step towards resetting the relationship with the public. We all must be on the same side, but solidarity depends on fostering and maintaining a level of trust between all social partners.
A day later, government lifted its e-commerce ban, which I, and others, had criticised as needlessly inflicting economic harm. This allows one avenue for the economy to resume and adapt. One can now buy anything (bar alcohol and cigarettes, and I see little sense in those restrictions) online. E-commerce has only ever accounted for a small component of retail sales but it could now see a major acceleration if sales avenues and logistics are able to scale up. It will be a challenge, but this is the kind of challenge that business thrives in response to.
Business has also begun working alongside social partners through Nedlac on the detail for the move to level three. There is much to be done to ensure staff and customers can operate safely. Everyone is tackling these issues urgently because the sooner we can safely move from level four, the better for all. The intention must be to safeguard the health battle while we ensure that all business that can operate safely is able to resume. This is the only way the economy can recover, and jobs, taxes and incomes can be restored. We are seized with the challenge of figuring out the best way possible to protect the public while resuming activity. The president has opened the way for this collaboration, and it is, I believe, the best way we can make the breakthroughs necessary to adapt to the new reality of living and working with the virus.
These measures pertain only to reopening the economy and getting business moving again. That is, though, only part of what needs to be done. We need to be thinking about the recovery and what forms of policy reform will give us the best shot of rebuilding and growing the economy in the longer term. The legacy of this crisis could be with us for a very long time if we don’t make the decisive moves needed to put the economy onto a growth path.
One major area that is long overdue for structural reforms is with SOEs, particularly Eskom. Last week I wrote in Business Report that a restructured Eskom is the way the state will be able to attract interest from private shareholders needed for fresh capital injections into the parastatal. Changing dynamics from the coronavirus as well as S&P Global downgrading its rating on the utility should spur the state to push ahead with its restructuring plans at Eskom that the president, along with the department of public enterprises, have agreed to. While Eskom is using the lower demand because of the lockdown to deal with it maintenance backlog, the utility’s debt is still the biggest sovereign risk to our economy.
BLSA hosted an online webcast with trade and industry minister Ebrahim Patel last week. The minister has shown great willingness to explain policy thinking and listen to feedback for which I am very grateful. Level four is something of a testing ground to assess Covid-19 readiness for moving to levels three and two, to learn more about the challenges and states of readiness, he said. He emphasised that government was determined to open as much of the economy as soon as possible. Level four is not, he says, a time-based programme as was level five; rather it is fluid and different parts of the economy and even different geographical areas will be able to move to level three as they are considered to be ready for fuller operations. That will be determined by the effectiveness of the health and social distancing protocols in place.
Hopefully, the governing party is finally accepting the world as it is and not how it wants it to be. In the early stages of Covid-19 it was very worrying so see the ANC and alliance partners put out a rambling statement that the state should not in any way seek assistance from the IMF and World Bank. Thankfully, sanity has finally prevailed and the ANC’s stop structures have realised there is no choice but to go to the IMF and other institutions for assistance. Loan conditions set by the IMF may well be good for the country given the mismanagement, maladministration and corruption we’ve seen around the public purse over the past decade, I wrote in Business Day.
Statistics show that during the national lockdown period, reported cases of GBV have spiked from less than 1,500 to over 5,000 per week. BLSA has thrown its support behind the #NoExcuse initiative, which aims to tackle gender-based violence (GBV) during the lockdown. Launched by Carling Black Label (AB-InBev) in 2017, the initiative is a whatsapp line that allows victims of abuse to get help. The service allows people to send the word BRAVE to 0800 150 150 so that they are directed to the right organisations to provide them with assistance.
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