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`Unprecedented` national effort underway to combat Covid-19 as infections rise and economy dies

Source: news 24, 15/04/2020

And a series of economic forecasts also cast a pall, with the SA
Reserve Bank predicting the GDP to contract by 6.1% in 2020 and
Business for South Africa, the body coordinating the response to
the virus by organised business, expecting a contraction of
between 8% and 10%, with one million jobs possibly lost.

`At this stage, our central scenario is for a deep recession in
2020 followed by an upswing in economic growth,` Finance Minister
Tito Mboweni said during a conference call with reporters.

The SA Reserve Bank unexpectedly lowered the repo rate by 100
basis points to take it to 4.25%.
Mboweni announced he would take a series of measures to aid
economic recovery and structural reform to the Cabinet on
Wednesday.
Business for SA confirmed a design for a locally manufactured
ventilator and approved by clinicians will be made public within
days.
A Chinese cargo plane with medical supplies, including urgent
stocks of personal protection equipment, landed in Johannesburg.
But a series of briefings between Sunday and Monday have revealed
the scale by which the government`s response to the virus has been
augmented by efforts from academia and the private sector.
Within the space of 24 hours, the government`s chief scientist,
Professor Salim Abdool Karim, Mboweni, SA Reserve Bank Governor
Lesetja Kganyago and organised business, represented by a new
umbrella organisation called Business for SA, announced an array
of initiatives and plans to mitigate against the destructive
impact of the coronavirus on public health, the economy and
livelihoods.

The executive chairperson of financier Rothschild and Co in South
Africa, Martin Kingston who is one of the co-ordinators of the
Business for SA initiative, said organised business was in
constant, `dynamic` contact with the government, including
President Cyril Ramaphosa and various ministers.

`There is a receptiveness from the government to our proposals.
There are unprecedented levels of co-operation and collaboration
between the government and private sector in this time of need,`
he added at a briefing on Tuesday morning.

In addition, Mboweni, at another briefing on Tuesday, said he and
Kganyago spoke `at least four times a day` about the impact of
Covid-19 on the economy, the country`s fiscal position, potential
job losses and efforts to keep the economy alive.

And on Sunday, Abdool Karim, an expert in immunology and
infectious diseases with academic chairs at universities including
KwaZulu-Natal and Harvard, was confirmed as the lead scientist at
the head of a ministerial advisory group providing Health Minister
Zweli Mkhize with data.

This advisory group, which consists of 45 experts serving on four
subcommittees, meets almost daily to assess the evolving health
crisis.

Kingston told reporters the Business for SA initiative consisted
of seven workstreams working closely with the government,
including healthcare (which is driving the national ventilator
project), economic interventions (alongside the National Treasury,
SA Reserve Bank and Department of Trade and Industry) and labour
(as part of Nedlac consultations).

He added the country would not have any choice but to
`aggressively restructure the economy` after the virus subsides.
`Less than 50% of the economy is functioning, and 60% of small- to
medium-sized businesses have started or are considering
retrenchments. This represents more than six million people.`

Both Mboweni and Kganyago - in back-to-back calls with reporters -
said they expected the coronavirus to have a severely debilitating
effect on the economy.

The minister of finance said he would take a set of proposals to
`revitalise` the economy to the Cabinet on Wednesday, calling it
`a huge agenda item` and saying he would personally announce the
decisions taken by the national executive afterward.

Mboweni added the Treasury had been working on three scenarios,
including one with projections about the impact of a `prolonged`
lockdown.

`We have to start thinking about getting the economy moving after
April. But any decision we take must be risk-based. We need to get
the economy going, but it won`t help if we do it too early â€¦ our
decision must weigh risk.`

He said South Africa would be looking at international finance
institutions for help, including a possible loan of $60 billion
from the World Bank. The country will consider all options,
including in an emergency, Covid-19 specific facility from the
International Monetary fund.

Mboweni has instructed that the reprioritising of funds across the
national budget should be undertaken to ensure money flows to
those programmes where it is most urgently needed, including and
primarily to the Department of Health.

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