Africa Economy News Updates 2020
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South africa's economy probably contracted more than 30% in the second quarter when restrictions to curb the spread of the coronavirus shuttered almost all activity for five weeks, according to central bank forecasts.
That would be the deepest quarterly decline since at least 1990.
Meaning the technical recession continues.
President Cyril Ramaphosa says the Coronavirus pandemic has helped government in the implementation of a programme aimed at bringing the informal economy into the mainstream. The President said this when he fielded oral questions from members of the National Assembly during a hybrid question and answer session on Thursday. He said just before the Coronavirus outbreak, Cabinet approved the Township and Rural Entrepreneurship Programme. This programme is aimed at putting township and rural enterprises at the centre of economic growth. According to research commissioned by the Department of Small Business Development, the informal sector has a central role in the South african economy, as it accounts for 18% of total employment and contributes towards the livelihoods of millions of people. The pandemic has assisted the implementation of this critical intervention, which seeks to bring marginalised people and areas into the mainstream economy, he said. Responding to questions, the President said as part of governments package of responses to the pandemic, government has been providing financial and non-financial assistance to the informal sector to cushion workers from the economic effects of COVID-19. Government has also taken measures to support households that rely on income from informal businesses by topping up social grants over a six month period and introducing a special COVID-19 grant of R350 a month over six months for unemployed people. Financial assistance to informal businesses has taken the form of grants, loans and credit facilities that informal businesses can access to sustain their livelihoods. The non-financial interventions include business development support services that help informal businesses to improve their business management capabilities. This will assist informal businesses, should they wish, to make the transition to micro, small and medium-sized businesses in the formal sector, the President said. The interventions would make it easier for informal businesses to benefit from government incentives, SMME programmes and procurement opportunities. The President said the Department of Small Business Development has introduced programmes targeted at specific sub-sectors of the informal economy. He said over the next three years, the programmes aim to support 100 000 spaza shops and general dealers, 50 000 artisanry businesses, 15 000 hairdressers, beauticians and other personal care businesses, 50 000 vegetable street vendors and butcheries, and 10 000 informal restaurants. Other programmes include the Small Scale Automotive Aftermarket Support Scheme to support 5 000 informal businesses over 12 months, and the Bakeries and Confectioneries Support Programme, targeting 3 500 businesses over 12 months. Some of these programmes have already been implemented and are gaining traction. Through these programmes, which prioritise black-owned, youth-owned and female-owned SMMEs, thousands of jobs have been saved and a significant number of SMMEs have been kept in business.
The effects of COVID-19 on the South african economy are expected to produce the worst economic downturn in a century, says SA Reserve Bank (SARB) Governor Lesetja Kganyago.
The effects of Covid-19 on the South african economy are expected to produce the worst economic downturn in a century, says SA Reserve Bank (SARB) Governor Lesetja Kganyago.
Several labour offices will remain shut for a few weeks after employees tested positive for COVID-19. The Mitchells Plain labour centre and its satellite office in Nyanga will be closed for an additional week after another employee contracted the virus. Meanwhile, the Paarl Labour Centre has also confirmed a case and the office closed its doors from Thursday. The officials had interacted with other employees, who were working at the labour centres. The affected employees will now self-isolate and have been referred for counselling, said Provincial Operations Chief Director, Mawele Ntamo. He said the offices have been conducting regular assessments of employees, which includes daily health checks and temperature screening. The Unemployment Insurance Fund (UIF) head office in Pretoria has been hit by COVID-19, with an employee who tested positive. The office will be closed, which may affect operations. However, the Labour Department said payment of benefits will continue. The departments Director-General, Thobile Lamati, has previously stated that the safety of employees remains paramount. Our officials are an important cog of the working of the South african economy and as such, we will also ensure that they are as safe as possible, he said. As it stands, the offices in the Western Cape, which has over 60% of the reported COVID-19 cases, remain the hardest hit. Services resumed in Vredenburg in the Western Cape and East London in the Eastern Cape after they were both closed due to COVID-19. The Paarl labour centre is expected to resume operations on 22 June, while the Mitchells Plain Labour Centre, Nyanga satellite office and the UIF office will open on 25 June. Clients are encouraged to make use of the departments online services in the meantime, the department said.
The ratings agency downgraded South africa's credit rating further into "junk" territory in April, citing the lack of a clear path towards government debt stabilisation and the expected impact of the COVID-19 shock on public finances and growth.
Covid-19 and 10 years of declining growth put the South african economy into freefall. Insurers are heading into an environment where consumers will be under tremendous financial pressure and questioning the value proposition of all their financial planning solutions...
The World Bank has published its latest Global Economic Prospects report for June 2020, paining a bleak picture for global growth amid the Covid-19 pandemic.
The africa Women Innovation and Entrepreneurship Forum ( Awief ) is calling for nominations for the Awief Awards 2020. The awards, which are to be held in December, aim to honour female founders and entrepreneurs designed to recognise and celebrate their contribution to the growth of africas economy. In a statement last week, the organisation said this year a new award category, the Energy Entrepreneur Award, has been created to recognise excellence in the power, oil and gas, and renewable energy sector. Said Aweif founder and CEO Irene Ochem: "We have an obligation, now more than ever, to recognise and showcase those women founders and entrepreneurs who are building solutions and driving change in the african economy. Past AWIEF Awards winners have included: Stella Okolie (Nigeria), Wendy Luhabe (South africa), Jennifer Riria (Kenya), Soraya da Piedade (Angola); Temie Giwa-Tubosun (Nigeria); Caroline Pomeyie (Ghana). Nominations can be submitted for eight categories. Nominees can either be nominated by a third party or be self-nominated. Nominations close on 30 June at 23:59 GMT.