Covid-19 economic recovery plan – Solidarity

Movement says this contains proposals on what decision to take at this critical juncture

Solidarity announces Covid-19 economic recovery plan

20 April 2020

Solidarity today announced its Covid-19 economic recovery plan. This plan offers a comprehensive analysis of past economic crises and how South Africa’s response in the past has led to stagnation and poor growth. The plan also contains proposals on how to now take the right decisions at this critical juncture.

Solidarity’s plan was submitted to the President and to Ministers Ebrahim Patel and Tito Mboweni. 

Dirk Hermann, Solidarity’s chief executive, explains: “Our plans address every aspect of the economy.”

According to Solidarity’s economic recovery plan, South Africa must urgently apply itself to create a more dynamic labour environment. The business world must be liberated from oppressive regulations and trade restrictions. Furthermore, South Africa’s fiscal position needs to be improved by cutting government spending and by getting rid of all non-essential state-run institutions. Also, more money needs to be put in South Africans’ pockets by reducing the tax burden. Furthermore, according to the plan, it is non-negotiable that harmful policies that undermine trust and certainty, such as expropriation without compensation and the national health insurances must be rejected immediately. Finally, the absolute need to decentralise South Africa’s energy sector is also highlighted in the Solidarity plan.

According to Solidarity concerns over the economy should not be assessed on the basis of a trade-off between health and wealth. Those two aspects are related and interdependent characteristics of human well-being.

“The Covid-19 debate should include the economy and jobs. The virus cannot be combatted without the economy and the economy cannot grow if the virus is not successfully combatted. There should not be a choice between health and economy – the choice is for both. In fact, victory over the virus is the most important aspect of any economic stimulus. We need to combat the threat of the virus as soon as possible so that we can get the economy back on track and ensure that the lockdown does not continue for a single day longer than necessary,” Hermann said.

This plan represents the last of three comprehensive plans that respectively announce strategies to combat the virus, to work during the lockdown and for the economy post lockdown. 

“Solidarity’s Covid-19 plan stands on three legs. The first leg is undaunted resistance to the virus. We are widely encouraging our members to strictly adhere to anti-virus practices. The second is an undaunted drive in favour of work. Solidarity regards all work as essential and believes that everyone who can work in a healthy manner must work. That is why Solidarity has submitted a comprehensive code of good practice for working in a healthy way to government. The third is an undaunted commitment to the recovery of the economy. Solidarity presented an economic recovery plan, offering lessons learnt from winning countries in an economic context,” Hermann said.

“This plan serves as Solidarity’s input to the meeting of the cabinet and the command council to be held on Monday 20 April. Our plans are grounded on a historical analysis of global trends that have led to success the world over. It includes scientific economic theories and offers workable solutions at a time when such answers are needed,” Hermann concluded.

To read Solidarity’s letter to the President and the relevant Ministers click here.

To read Solidarity’s Post-lockdown Economic Recovery Plan click here.

Issued by Morné Malan, Solidarity Strategic Specialist, 20 April 2020