( 5 minutes read)
· President Cyril Ramaphosa said that the strict coronavirus
lockdown – which was extended from 16 April till the end of the month
– will not be rolled over.
· However, he hinted that the reopening of the economy will be
in stages and restrictions will be lifted only on certain sectors.
· President said that of the R 500 billion, approximately R130
billion will be reallocated from the existing budget and R200 billion
will be provided in the form of a loan guarantee scheme.
President Cyril Ramaphosa said that the strict coronavirus lockdown –
which was extended from 16 April till the end of the month – will not
be rolled over. However, he hinted that the reopening of the economy
will be in stages and restrictions will be lifted only on certain
sectors.
President said that some activity will be allowed but subject to
extreme precautions. There will be stiff conditions for functioning of
such industries. They will have to adhere to stiff health and safety
protocols to protect their employees. There should be disease
surveillance plans and measures to prevent infection. However, the
President did not mention which businesses would be allowed to reopen.
Cigarettes, he said, would be available for sale along with other
goods. He did not mention liquor, though he said bars would continue
to remain closed. There is a huge demand from people and the liquor
companies to allow sale across the counter. Food retail stores will be
allowed to sell the full line of products within their existing stock.
Earlier, they were allowed to sell limited products.
It is expected that travel restrictions would continue to be tight and
people will be encouraged to work from home. The National Command
Council is entrusted to decide the type and level of activities to be
allowed based on an assessment of the infection rate in conjunction
with the capacity of the healthcare system, Ramaphosa said.
President Cyril Ramaphosa announced a R500 billion stimulus package
to partially mitigate the impact of the extended lockdown on South
Africa’s economy. The policy measures announced include R100 billion
expenditure towards preserving and creating jobs, an extensive food
parcel delivery program, and R20 billion additional spending to boost
municipal service delivery.
President said that of the R 500 billion, approximately R130 billion
will be reallocated from the existing budget and R200 billion will be
provided in the form of a loan guarantee scheme. This will be in
unison with major banks, National Treasury and the SA Reserve Bank.
Close to R170 billion would be sourced from Covid-19 support loans
from international financial institutions, global partners and
domestic sources. Covid-19 has come as a double whammy to South
Africa, which was already in the grip of a severe recession. Two
consecutive quarters of negative growth had driven away the foreign
investors and some of its domestic players folded up businesses and
started investing in other countries. One after the other, all
international credit rating agencies have downgraded South Africa,
giving a jolt to its drive to scout for mobilizing more FDI.
The Reserve Bank has said a contraction of 6.1% is likely, while the
International Monetary Fund has projected a negative growth of 5.8%.
Moody’s, however, has suggested a more conservative negative growth at
2.5%. Importantly, job losses have been projected at anything from
370 000 to one million.
