TIPS Tracker on the economy and the pandemic highlights important trends in the COVID-19 pandemic in South Africa, and how they affect the economy. This issue also looks at the challenges facing the auto and music industries. See 21 September - 4 October 2020.

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.

Download copy or read Tracker online.

As South Africa responds to COVID-19 and aims to stimulate the economy post lockdown through an infrastructure-led package, an opportunity exists to address many of the electricity-related challenges in the country by unlocking the potential of renewable energy technologies. This policy brief looks at the benefits of including renewable energy in the country’s stimulus package and considers possible avenues to do so.

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The R500 billion stimulus package announced by President Cyril Ramaphosa on 21 April 2020 is almost certainly cheaper than not acting. While stimulus packages are complex to manage, the complexities of managing a messy set of rolling closures as a result of a crisis like COVID-19 would be worse. Experiences from previous crises indicate that early implementation of stimulus measures that stop short-term shocks from turning into systematic crises offer the best means to reduce the economic impact of the pandemic and avoid the resulting human suffering. This policy brief aims to assess whether the current stimulus measures are adequately aligned to the expected shocks resulting from COVID-19.

Business Day - 11 May 2020 by Neva Makgetla (TIPS Senior Economist)

Read online at Business Day.

Or read as a PDF.

Times Live 8 May 2020 by David Chambers  

South Africa has adopted a phased approach to reopening the economy. The relaxation of restrictions on economic activity will depend on the extent to which the contagion is controlled and the health sector prepared to deal with a surge. In that context, the specific regulations for the economy are still being considered. This brief seeks to assist the process by analysing the experiences of countries that succeeded in ending the threat of COVID-19.

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This brief argues that government needs a large response to the COVID-19 crisis, with a package that approaches R1 trillion. A stimulus that large cannot be financed using the conventional mechanisms. Instead, government must use quantitative easing, both to offset the collapse in demand and to finance government expenditure. Interest rate cuts will help but the response to this crisis has to be driven by fiscal policy, because only fiscal policy can replace lost wages and revenue. An inadequate stimulus risks turning a recession into a depression.

From 2 May to 5 May, the Western Cape accounted for three quarters of new COVID-19 cases in South Africa, although it makes up only a seventh of the population. On 5 May, the incidence of COVID-19 in the Western Cape was 52.4 per 100 000 population, compared to 7.6 per 100 000 in the rest of the country. The Western Cape's high share of new cases reflected the rapid growth in infections there, almost exclusively in Cape Town. The fastest rates of increase have been reported in Tygerberg, (which includes Langa) followed by Khayelitsha and Klipfontein (which includes Nyanga and Gugulethu). The number of known cases in the Western Cape rose at 9.4% a day from 20 April to 5 May; in the rest of the country, it climbed at 3.5% a day. At that rate, the number of cases is doubling every week, compared to a doubling rate of three weeks in the rest of the country.

This policy brief points to the need for urgent action to address the spread of COVID-19 in Cape Town. In that context, it raises a number of questions that might help in understanding the relatively rapid spread of COVID-19 in Cape Town, and by extension the changes needed in how the contagion is handled there.

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Mail & Guardian - 16 April 2020 by Tshegofatso Mathe.

Read online at Mail & Guardian.