This TIPS tracker highlights important trends in the COVID-19 pandemic in South Africa, and how they affect the economy. It analyses publically available data, research and media reports to identify current developments and reflect on the prognosis for the contagion, the economy, and policy responses.
KEY FINDINGS FOR THE WEEK
On the pandemic
- The number of new cases stabilised outside of the Western Cape, where they continued to escalate, and the Eastern Cape, where they fluctuate significantly over time. The average daily growth in identified cases declined in the most affected provinces (Western Cape, Gauteng, KwaZulu Natal and the Eastern Cape), but increased sharply in Limpopo as three major mines reported outbreaks.
- The Western Cape effectively faced a qualitatively different pandemic from the rest of South Africa, with 200 cases per 100 000 people compared to 13 per 100 000 in the rest of the country. The reasons included how the province managed screening and quarantine; relatively dense informal settlements with largely shared facilities; and its role as a global tourism hub.
- The main epidemiological model projects a spike in winter but indicates that it can be avoided if South Africans work to prevent infections through changes in behaviour, including
reorganising work and public transport, and stringent public health measures.
On the economy
- On Sunday, 24 May, President Cyril Ramaphosa announced that all businesses could open except for recreational and personal services, as long as they had plans to maintain physical distancing. He did not, however, indicate how rigorous physical distancing measures would be, including in the high-risk areas of public transport and retail.
- The economic boost from the move to Level 4 largely ran out of steam, with only limited increases in economic activity in the second week. On Wednesday, the SARB predicted a 7% fall in the GDP for the year, down from its April forecast of a 6,1% decline.
- At the company level, four large mines closed temporarily due to outbreaks after resuming work under Level 4; a number of SOCs fell deeper into crisis; and the R500-million fund for small business was fully allocated by Friday, providing funds to around 5% of the applicants.
- The UIF had provided R14 billion to benefit 2,5 million furloughed workers. By the end of the week only 10 people had received the COVID-19 special grant (worth R350 a month), with another 100 000 applications finalised. All told, 4,5 million had applied and 2,6 million had been verified.
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