Weighing the next step
Ebrahim Patel on reopening the economy
The last time the world faced a global pandemic, 500-million people — a third of the world’s population at the time — were infected. A staggering 50-million people reportedly died. The 1918 Spanish Flu (as it became known) wrought devastation on humanity.
That stark memory echoes through the Covid-19 crisis. Millions of lives could be lost, and deep damage inflicted upon a world more integrated than in 1918.
Globally, more than 4.5-million people have been infected by Covid-19 and already 300,000 people have lost their lives. In SA, we too have had to count the human cost — already more than 250 people have died after contracting the coronavirus. Given how quickly the virus spreads, the number of fatalities will be much higher. These are mothers, fathers, friends, neighbours, colleagues, sometimes children, who pass away, leaving families and friends devastated by loss.
The economic costs imposed by the virus are also extraordinary. Across the world we have seen shuttered factories and empty roads. The South African economy is projected to go into a sharp recession, with very large job losses and firm closures, as a result of a dual shock in economic demand and supply as a result of the lockdown to contain the spread of the virus. Small businesses and emerging enterprises have been particularly hard hit. Now many, here and abroad, are asking: is it worth it? And what happens next?
When the lockdown started, new cases in SA were doubling every two or three days. Since then, outside of the Western Cape, the infection rate has moderated, doubling only every three weeks. As at Friday, the national infection rate had risen to 22 cases per 100,000 people. For comparison, in the US and Europe infection rates were well over 300 per 100,00.
My home town and the country’s legislative centre, Cape Town, is, however, an outlier, with infections increasing more than threefold over the past two weeks to over 100 cases per 100,000 people.
The manageable level of hospital admissions thus far underscores the value of moving early and moving swiftly with the lockdown.
The number of cases is of course still rising, and some epidemiologists say they will accelerate as winter deepens. Quite worryingly, reports of spikes in infections emerged in countries that have eased their lockdowns, including Germany, South Korea and China. And history shows that a second wave of a pandemic can be worse than the first. The World Health Organisation thus advises that countries planning to ease their lockdowns need to do so with extreme caution in order to avoid this second wave.
The lockdown bought us some space to reorganise economic activity, public health measures and our own lives to minimise the risk of infection while opening up more economic activities. This balance is an extremely difficult one.
There is no simple, static trade-off between health and economic prosperity. If the pandemic surges out of control, the subsequent stricter lockdowns come with a heavy economic cost.
When we invest to control the coronavirus, we also build the basis for future economic growth and, done right, for deeper transformation of our economy, to make it greener, fairer, more inclusive and more dynamic. When we restrict risky activities and avoidable physical contact or bolster public-health measures, or act to carefully isolate hot spots, we safeguard our economic livelihoods from future threat.
To get South Africans back at work safely, we need high levels of co-operation between employers, workers and consumers to manage the main areas of risk. With concerted effort, businesses can reduce the risk of transmission at the workplace. Social distancing and constant hygiene are key. But with so many working people dependent on public transport, an overcrowded train or taxi can spread the virus rapidly, transmitting it to the workplace and the home.
Food retail, chemists and public transport stayed open during the lockdown, following health and social distance protocols. Even then, there have been significant clusters of infection in retail chains, pointing to the need for stricter adherence to guidelines on maintaining distance, and to screen workers and trace and quarantine their contacts.
As we move to reopen the economy, we have to be cautious with high-risk businesses that serve the public directly, particularly those with physical contact. This is a moment for innovation in business models and products to help reduce our risks. That is why we have expanded delivery services and ecommerce, which can minimise families’ risks from shopping.
In contrast, businesses that do not serve the public directly can reduce the risk of infections if they strictly adhere to health and safety protocols. Measures like ensuring physical distance between workers, wearing masks, regular sanitation, good ventilation and screening workers daily for symptoms of Covid-19 are necessary. Businesses will have to keep reliable contact details for employees and visitors, so that if a case turns up they can identify who else might have been exposed. Compared to 1918, a more integrated world poses greater risks, but higher levels of technology and scientific knowledge offer greater tools to fight a pandemic.
Scientists’ advice about our success to date with flattening the infection curve enables a shift of significant parts of the economy to lower alert levels. But our success in staying at lower levels will depend on containing the spread of Covid-19, by urgently addressing hot spots (currently Cape Town and, to a lesser extent, other districts and metros), expanding mass screening, testing, tracing contacts and making use of quarantine centres.
On Wednesday, President Cyril Ramaphosa announced the intention to shift most of the country to alert level 3, though the parts of the country with the highest rates of infection may need to remain on level 4. On Friday, he met with the National Economic Development and Labour Council and yesterday with provincial premiers, to consult on a risk-adjusted phasing-in of economic activity. This consultation process included publishing a risk-management framework three weeks ago, garnering more than 70,000 responses to help shape our implementation.
The move from level 5 to level 4 enables about 2million employees to return to their workplaces, bringing the total to about 50% of normal employment. Those working from home add to this number. Level 3 will further expand the scope for business activities that can reopen. However, not all will be able to get back to full speed immediately. Public transport risks will need to be managed through staggered working times and a joint effort with business to fix the problems for those who commute to work on a daily basis.
Workplaces can play an important role in managing the spread of Covid-19 by implementing regular screening and testing of employees, giving a daily real-time snapshot of the spread of the virus.
All of us face deep disruption in our lives and work. Until there’s a vaccine or effective treatment, the world will need to adjust to the new normal. We cannot wish away the risks from this devastating new disease or set predictable, fixed timeframes for regulatory changes. As citizens, workers and employers we can, however, take responsibility by understanding the risks and responding appropriately. We must act collectively to protect and support each other while rebuilding our economy and our society.