Impact of Covid-19 in the South African Economy
Coronavirus
has caused a negative impact in the South African economy
By: Karabo Xaba
Twitter: Mpenduloenhle Karabo
Email: kxaba54@gmail.com
South Africa has been affected negatively by the strike
of Covid-19. On the 23 of March 2020 President Cyril Ramaphosa announced the 21
days lockdown in order to contain the spread of the coronavirus.
The announcement of the lockdown played a huge role in
forcing businesses to close and led to millions of people losing their jobs.
According to Census 2022, during the country’s Coronavirus lockdown South
Africa’s economy lost 2.2 million jobs in the second quarter of 2020.
According to the
Census 2022, the amount of money the national government collected overall in
taxes declined from R1 385 billion in 2019–2020 to R1 290 billion in 2020–2021,
a drop of R95 billion was discovered.
Xolani Sibiya a small business entrepreneur explained how
Covid- 19 affected his business
“Covid- 19 lockdown affected my business badly, as a
small business owner I was struggling to obtain a permit for my business to
operate. Suppliers were completely shut down, so I had problems when I had to
provide goods to my customers and the high rate of people losing their jobs
made me lose consumers.”
One third of South African firms were affected by the
coronavirus pandemic in terms of importing and exporting goods and services.
This
is based on the results of the April 2020 survey. 38 percent of businesses that
responded to this survey indicated to see an effect in import, whereas 32.3
percent for the export of goods and services.
Not only the importation and exportation of goods and
services was affected but the Gross Domestic Product (GDP) had a persistence
effect. According to the census 2022 GDP fell by just over 16% between the first and second quarters of 2020,
giving an annualised growth rate of ‑51%.
Samkelisiwe Ntuli a second
year Economics student at North West University explained briefly on how
Covid-19 affected the South African GDP.
Samkelisiwe Ntuli said
that Covid-19 affected the GDP of the South African economy in a bad way. The
GDP shrieked in a negative percentage in 2020 which was -6.3% meaning that’s
bad news for businesses and leads to recession of which layers were made. Many
sectors of the economy were declining, the declining of business revenue and
consumers spending.
In 2020 a sizable number
of people in the neighborhood out of 3 million lost their jobs, contributing to
the nation's rising unemployment rates. A research by Ipsos from the University
of Johannesburg's Centre for Social Development in Africa indicated that nearly
half (46%) of adult South Africans agreed with the following statement.
Lebogang Mokoqama an
unemployed male said, “Lockdown affected my family bad, I was the only one
employed and taking care of my family, but the implementation of lockdown got
me retrenched and now I’m struggling to find another job.”
Lockdown had a negative
outcome to most South African citizens; most people struggled to adjust to the
rules that were implemented by the President.
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