The Congress of South African Trade Unions has noted the decision by South African President Cyril Ramaphosa to put the country on a twenty-one (21) day national lockdown, as a way of combatting the Covid-19 epidemic. We welcome this intervention by the President and we urge all citizens to cooperate and play their role to make the fight against this deadly epidemic a success.
The outbreak of Covid-19 epidemic has reminded us of the vulnerabilities and inadequacies of our health system. Looking at how better resourced nations around the world are struggling with this epidemic, this decision was inevitable in this country, especially with the rise in the numbers of infected people.
This national lockdown though will test our already ailing economy and push it to the brink and if bold measures are not taken speedily, we likely face a full-scale economic depression with unprecedented job losses. We welcome the economic interventions announced by the president so far to cushion the workers and vulnerable businesses, but they are obviously not enough.
The survivalist rural and township economy cannot be left to the charitable donations and the benevolence of the well-off. Informal businesses need the government to be hands-on in assisting them. More than 60% of South Africans depend on the survivalist informal economy and this shutdown will hit them hard.
After this drastic decision by the President, the SARB needs to explore another rate cut in the month of April by no less than 100 basis points. COSATU wants to see commercial banks cutting the lending rates by much more than the 100bp granted by the bank.
They also need to follow in the footsteps of Italian Banks by offering loan three-month payment deferment holiday for all loans, in particular for working- and middle-class families and at-risk companies and industries. This is affordable given the resources available to the financial sector and would simply be a temporary deferment.
Lastly, we are disappointed that the government has announced a stimulus package. We propose stimulus plan combining the public sector (PIC, DBSA, IDC, and other state banks) and private sectors( banks, investment, and pension funds) to focus on financing the key vulnerable sectors of the economy.
This economic crisis is unprecedented and requires bold, creative and decisive interventions to ensure the survival of the entire economy. The government cannot outsource its leadership responsibilities at this critical period. Delaying these urgent interventions will amount to economic suicide.
COSATU also demands that special arrangements be made by employers to transport those workers who are expected to continue working and to ensure that they are not exposed to this virus. Private sector companies that will be exempted from this shutdown need to make special arrangements for these workers.
Issued by COSATU
Sizwe Pamla (Cosatu National Spokesperson)
Tel: 011 339 4911
Fax: 011 339 5080
Cell: 060 975 6794