JOHANNESBURG – South Africa has taken early action to limit the spread of Covid-19 by ordering a nationwide lockdown for its population of 59 million people. The novel coronavirus has spread widely in South Africa relatively recently compared to other countries.
However, as Covid-19 cases are fast increasing, there is great concern about the disease’s potential spread and impact.
South Africa has to be ready for a possible surge as testing expands significantly.
Given the nature of the spread of the pandemic, South Africa after the 21-day period expired extended the full lockdown by a further 14 days. After April 30 South Africa will move to Level 4 of the lockdown, which will see selected sections of the economy going back to work in an attempt to walk the tightrope of balancing health with economic imperatives.
These measures may help in limiting the health crisis, but as in other countries, the continued complete shutdown of all economic activities except essential services would exacerbate the already present economic crisis and misery for the poor, with massive job losses and rising food insecurity. Although the South African government had the foresight to, ab initio, declare agriculture and the entire agri-food sector as essential in order to minimise the disruption in food supply thus averting a food security disaster.
The global economy will undoubtedly take a severe knock from the pandemic. The economic shock will likely be much more severe for South Africa, for two reasons.
First, pre-Covid-19, the economy was already slowing down and entering a recession, albeit technical recession, compounding existing problems of unemployment, low incomes, rural distress, food and nutrition insecurity at household level and widespread inequality. Second, South Africa’s large informal sector is particularly vulnerable. Lacking regular salaries or incomes, these agriculture, migrant, and other informal workers would be hardest-hit during the lockdown period. This article focuses on the likely impacts on agriculture, agri-food supply chains, food and nutrition security and livelihoods.
Similar to the rest of the South African economy, the agricultural sector had already been suffering before Covid-19 due to a series of droughts, biosecurity breaches (such as the Foot-and-Mouth Disease outbreak), rising input costs because of, inter alia, the weakening Rand, deteriorating market, processing and research infrastructure.
Thus, the sector has been lagging behind the rest of the economy, having experienced an average 1.7 percent long-term growth in the past 13 years compared to a 2.3 percent growth for the overall economy during the same period.
As if to add insult to injury, the agricultural sector recently contracted by 1.3percent (experienced a -1.3 percent average growth rate) in the past five years compared to the marginal overall economy growth rate of 0.8 percent during the same period. Therefore, Covid-19 will further compound the woes of the South African agricultural sector. Covid-19 is curtailing a number of activities in the agricultural sector and disrupting supply chains.
Preliminary reports indicate that the non-availability of migrant labor is interrupting some harvesting activities, particularly in the harvesting of horticultural and summer grain crops. There are disruptions in supply chains because of transportation problems and other issues.
Farm gate prices have declined for fruits, vegetables, and other crops, yet consumers are often paying more. Media reports show that the closure of hotels, restaurants, and other food away from home outlets during the lockdown is already depressing milk sales with dairy farmers having to throw away milk.
Again, the South African government has been proactive in this regard, providing a generous stimulus package to the economy to the tune of over R500 billion to minimize the deleterious effect of the pandemic and the concomitant lockdown. Here are some measures required to keep the agricultural sector and supply chains working smoothly:
The government has correctly issued lockdown guidelines that exempt farm operations and supply chains. While this is commendable, implementation problems leading to labour shortages and falling prices need to be rectified.
Keeping supply chains functioning well is crucial to food security. Food insecurity can arise even if sufficient food quantities are available if disruptions occur in the supply chain and food cannot get to where it is needed thus accessibility becoming an issue.
The farming community must be protected from the coronavirus to the extent possible by testing and practicing social distancing.
Farmers must have continued access to markets. This can be a mix of private markets and government procurement.
Small poultry and dairy farmers need more targeted help, as their pandemic-related input supply and market-access problems are urgent.
Farmers and agricultural workers should be included in the government’s assistance package and any social protection programs addressing the crisis.
As lockdown measures have increased, demand has risen for home delivery of groceries and e-commerce. This trend should be encouraged and promoted.
The government should promote trade by avoiding export bans and import restrictions.
The lockdown has choked off almost all-economic activity leading to loss of jobs and incomes for informal workers and the poor.
The shutdown will cause untold misery for informal workers and the poor, who lead precarious lives facing hunger and malnutrition. The best way to address this urgent need is to use social safety nets extensively to stabilize their lives with food and cash.
The South African government has quickly responded to the crisis and announced the R500 billion economic stimulus package, which includes food and cash transfers. The economic stimulus package offered by the South African government is aimed at providing safety nets for those hit the hardest by the Covid-19 lockdown.
Below are some additional measures needed in addition to the government package:
Food and nutrition security: In order to avoid exclusion errors, it is better to offer universal coverage of distribution in the next few months. The food parcels should contain local produce as much as is possible while taking into cognizance that some foodstuff, such as rice and wheat, are largely imported.
Cash transfers: Unemployed and informal workers and traders need cash income support through cash transfers.
Migrant workers: migrant workers should be given both cash transfers and nutritious food.
Covid-19 is an unprecedented challenge for the entire world and South Africa is no exception.
A significant proportion of the South Africa population depend on the agricultural and informal sector for their employment and livelihoods thus lockdowns and other social distancing measures are hugely disruptive.
The South African government has recognised this challenge and responded aggressively, but this response should be just the beginning. South Africa must be prepared to scale up its response as events unfold, easing the economic impacts through even greater public programme support and policies that keep markets functioning.
Dr Thulasizwe Mkhabela is an agricultural economist and is currently the Group Executive: Impact & Partnerships at the Agricultural Research Council; email@example.com
By Thulasizwe Mkhabela