SA must brace for social unrest – study

South Africa has been identified as one of the countries vulnerable to social unrest in the next 18 months.

With Covid-19 engulfing the world, it was likely to intensify the high of systemic social risk, not only in South Africa, but also the rest of the continent in the near future. This is one of the findings of the Social Risk Index (SRI) undertaken by giant international credit risk insurers Euler Hermes and Allianz.

The quarterly index assessed countries that were particularly vulnerable to systemic social risks such as social discontent, demonstrations and protests.

These will have an impact on the political orientation and policy making of a country, its companies and its ability to generate and attract investment.

In its assessment, Euler Hermes focuses on the evolution of a country’s risk. But this year the credit insurance company has added environmental, societal and governance risks to its analyses.

The SRI 2020 identifies South

Africa as highly vulnerable to social unrest in the next 18 months.

The country is placed 79th out of 102 in the assessment.

The study said this reflected weaknesses across almost all subindicators of the index.

The indicators included high income inequality, the recent currency depreciation, low labour force participation and declining real gross domestic product.

Other significant factors taken into consideration were the perceived political instability and a low level of trust in the government.