State must stop covidpreneurs and give small business a break
PPEs procurement and supply a perfect opportunity to stimulate economic growth in townships and rural areas
It would be churlish not to applaud the, albeit long overdue, government-led efforts to clamp down on the thieves who have used the coronavirus pandemic to loot public funds meant to fight the flu-like disease which has claimed more than 10,000 lives to date.
Still, we shouldn’t squander the opportunity to stimulate our economy to benefit black communities in our townships and villages who have been robbed by the Covid-19 thieves in the name of black business.
Tomorrow, we will receive further evidence of the devastation Covid-19 has wreaked on jobs when Statistics SA releases the latest unemployment numbers. We are most likely to learn that hundreds of thousands have lost their livelihoods. Worse, the data will confirm two other worrying trends: first, that the impact is disproportionately felt by women; and second, that blacks are worst affected by unemployment.
Also, at the end of the week, the current lockdown will expire, meaning the government will have to open up more of the economy in the battle to save livelihoods.
This is both an opportunity and a risk. As the economy is reopened, we face the risk of a resurgence of infections. In the absence of a safe and effective vaccine, we are left with one course of action: to learn to live with the virus while continuing with our lives.
Since the pandemic started, the only reliable way of preventing further infections and deaths has been to apply health protocols: wash hands, wear face masks and maintain social distancing.
Covid-19 has also opened up new opportunities which we need to seize with both hands. As more workers return to work, they will need face masks and sanitisers. This is a magnificent opportunity for government, state-owned enterprises (SOEs) and the private sector to alleviate unemployment and stimulate economic activity to build inclusive growth.
Government needs to immediately localise the manufacturing and supply of personal protective equipment (PPE) – masks and gloves – for both frontline workers like doctors and nurses as well as the wider public. Tenders need to be broken down to more chewable chunks for small firms, especially women-owned.
Communities need to organise themselves into cooperatives to produce, distribute and sell these PPEs. If done right, this has the potential of stimulating both the clothing and textile as well as transport sectors.
Owing in part to cheap imports, there are literally hundreds of factories lying idle which can – with minimal state support – be reopened for this anti-Covid economic response. .
To avoid further thieving, it would be preferable for government to sign up individual cooperatives and households willing to take advantage of this opportunity. Part of the money could come from the R200bn credit guarantee scheme which has not gained traction.
To bolster demand, SOEs, state departments and the private sector need to buy their PPE – including branded masks – from black small and medium-sized enterprises which have been robbed of a legitimate opportunity to grow by the covidpreneurs.
Due to this economic emergency, government should impose a punitive import surcharge to any firm that buys PPE outside SA.
Once this industrial capability is built, we should consider scaling it up to supply neighbouring countries especially Mozambique and Zimbabwe as well as members of the Southern African Customs Union (Botswana, Lesotho, Namibia and eSwatini) as part of boosting intraAfrican trade which has been paused by the virus.
Of course, the thieves need to account for their thievery.