The world has become connected – yet at the same time isolated – as a third of the global population still suffers varying degrees of restrictions placed on their movements. These regulatory measures are warranted and have been effective in “flattening the curve”, but the general environment continues to pose many challenges. As the lockdowns persist, certain regulations are being lifted, but a return to what is considered normal is still far on the horizon.
Coronavirus – Economic and Investment Impacts (Updated)
Dynasty acknowledges that Covid-19 is first and foremost a humanitarian crisis. However, our consistent standpoint since the first regional lockdown on 23 January 2020 by the central Chinese government to quarantine the centre of the outbreak in the Hubei province, is that human and economic health are very much symbiotic. Follow this link for more from Barry Dubb.
Global News
- Prime Minister Johnson has been recovering at home this week after being in ICU with complications from contracting the coronavirus. He profusely thanked the hospital and healthcare workers who aided him, personally naming several and saying, “I owe them my life”.
- More than five million Americans filed for unemployment benefits last week. This brings the total for the month since the pandemic was declared to 22 million.
- President Trump has cut funding for the World Health Organisation at the time of an unprecedented global pandemic.
- Dr Anthony Fauci, Director of the National Institute of Allergy and Infectious Diseases in the US, has said that President Trump’s announcement of a May 1 “reopening”, of the US economy, was “overly optimistic”. President Trump has denied claims that he intends to fire Fauci after the President retweeted a #firefauci post. This comes as Fauci drew criticism from Trump supporters after admitting that lives would have been saved had the United States acted sooner against the Covid-19 pandemic.
- Pharmaceuticals could be the US’s answer for getting out of their economic doldrums. Gilead’s shares have soared after STAT reported that patients appeared to show rapid recovery after taking a medicine called remdesivir. This is very much initial optimism, with Gilead themselves warning that more data is necessary to determine the drug’s efficacy.
- The International Monetary Fund (IMF) has announced that it would provide immediate debt relief to 25 member countries under its Catastrophe Containment and Relief Trust (CCRT), to allow them to focus more financial resources on fighting the coronavirus pandemic.
Local News
- On the 19 March, the SARB cut the repo rate by 100 basis points. This week, it cut the repo rate by a further 100 basis points taking it down to 4.25%. Additionally, the estimated contraction of the economy was revised from between 2% – 4% this year to 6.1%.
- Tito Mboweni announced that the budget for this year will have to be revised on account of the Covid-19 pandemic. He also said that South Africa is not looking for funding from the IMF that comes with a structural adjustment programme, but that the country is in discussion with them on Covid-19 specific packages.
- Minister of Cooperative Governance Nkosazana Dlamini Zuma has said that lockdown regulations will be lifted in stages. There will not be a sudden return to normal after the 30 April, but rather amendments will be made each week.
- The lockdown regulations that have been eased so far have been: regulations on travelling to funerals; children can move between co-parents; transportation of essential goods from warehousing sites has been permitted; evictions cannot take place during the lockdown; and restrictions have been eased on mining and petroleum refineries.
- It would seem that the biggest threat to lockdown regulations in South Africa is hunger: In the last few days there have been protests and looting on the Cape Flats, Alexandra, and Chatsworth – just to name a few. There are many large problems with food distribution in these areas, read on for more.
- South Africa has condemned President Trump’s decision to stop funding the World Health Organisation. The Department of International Relations and Cooperation said that “It is alarming that this very regrettable decision is announced as this deadly virus strikes Africa and the poorest and most vulnerable states.” This decision comes as the impact of the virus on wealthier countries is easing while its impact on developing countries has started to climb.
- Over the next three months, President Ramphosa and his fellow ministers will be donating one-third of their salaries to the Solidarity Fund. This Fund aims to prevent the spread of Covid-19 and to “flatten the curve” of the virus. Many South African business leaders have followed the President’s lead.
- South African Airways has been denied further funding. Public Enterprises Minister Pravin Gordhan has turned down a request from SAA’s business rescue practitioners for an additional R10-billion. Additionally, Finance Minister Tito Mboweni is considering the ‘closure of SAA’.
