ANALYSIS: Booze is back!
The economy will be restarted on June 1 as most sectors reopen. The president had little choice, in the face of worrying growth and employment projections, to reduce restrictions; but Covid-19 infections are rising sharply and not all are happy with the move
Last night, a weary-looking President Cyril Ramaphosa announced several major concessions that will take effect from next week as SA shifts to a level 3 lockdown. However, the de-escalation came as the country announced a record rise in infections – 1,240 new confirmed cases – attesting to the delicate balancing act Ramaphosa faces in reopening the economy.
Ramaphosa isn’t oblivious to this: he pointed out that one-third of the cumulative cases, the number of which has risen to 22,583, took place in the past week, while there have now been 429 deaths. The Western Cape accounted for 65% of both infections and deaths.
“We must expect these numbers to rise faster and sharper,” Ramaphosa said.
Yet, given SA’s worrying economic projections – with unemployment set to top 50% and GDP growth estimated to fall between 4.5% and 16.7% this year – he had little choice but to restart the economy, even as infections escalate.
Under the de-escalation, most sectors will go back to work from June 1, with just a few exceptions: restaurants and bars remain off-limits, as do beauty salons, hairdressers and entertainment outlets.
Importantly for the alcohol industry, which generates R137bn in sales a year and employs nearly 1-million people directly and indirectly, booze can now be sold during specific periods. The industry has claimed that due to the alcohol ban R19bn was lost to the country’s GDP.
Not that it’ll be back to normal for liquor outlets; a draft of the regulations, leaked over the weekend, suggested alcohol will be on sale only during the morning, Mondays to Thursdays.
Perhaps surprisingly, the aviation industry was thrown a lifeline too, as Ramaphosa announced that domestic air travel for business purposes will be “phased in”. It remains to be seen, however, whether enough people begin using the airlines to make it viable for them to fly.
In another concession, exercise will be allowed at all times, even though gyms will remain closed.
As was reported last week, cigarettes are still banned. This is despite a study of 16,000 respondents by UCT academics, released two weeks ago, which showed that 90% of smokers had managed to buy cigarettes during the lockdown regardless of the regulations.
“The current sales ban is feeding an illicit market that will be increasingly difficult to eradicate when the lockdown and the Covid-19 crisis is over. It was an error to continue with the cigarette sales ban into level 4 lockdown. The government should lift the ban on cigarette sales as soon as possible,” the researchers said. However, it is believed that co-operative governance minister Nkosazana Dlamini-Zuma lobbied hard for tobacco to remain on the banned list, despite opposition from, among others, finance minister Tito Mboweni.
The exact regulations will be spelt out this week and South Africans, scarred by the nonsensical restrictions on e-commerce and certain products during level 4, will be wary of the devil in the detail.
Still, while level 3 is likely to carry many constraints, the business sector will feel it’s at least something to work with. And importantly, it shifts the onus back to companies to put in place the right kind of protective measures for staff.
Business Unity SA president Sipho Pityana says while it’s time for many to go back to work, the aim is to do so “in as safe a way as possible and in a way that continues the struggle against this deadly virus”.
Pityana says it means companies must ensure they’re able to screen and test employees and trace workers who test positive for the virus.
But not everyone was pleased. The EFF says it amounts to Ramaphosa’s “resignation from fighting Covid-19 and saving lives, especially black lives”.
While the trajectory of restrictions might seem promising, this could still reverse. Ramaphosa warned last night that certain parts of the country “could be returned to alert levels 4 or 5 if the spread of infection is not contained despite our interventions and there is a risk of our health facilities being overwhelmed”.
The business sector, having finally been thrown a belated lifeline, will be eager to ensure this doesn’t happen.