Sakeliga supports top-economists’ plan to open the economy – safely 

22 April 2020

Business organisationSakeliga and several business chambers have announced that they intend to support an economic strategy proposed by a number of prominent South African economists and companies. 

The plan, proposed by ETM Analytics and ETM Macro Advisors, represents a drastic deviation from existing policies. Rather than prohibiting “non-essential” economic activity, it would identify and prohibit risky behaviours.

“Considering the imminent end of the nation-wide lockdown, it is important for public conversation on our post-lockdown strategy to be opened as soon as possible. Sakeliga believes that this plan represents an excellent approach to safely restarting economic activity,” says Piet le Roux, CEO of Sakeliga. 

“Though SARS-CoV-2 represents a serious danger to human health, the lockdown has demonstrated that economic disintegration also has the potential to kill. If we are not careful, this situation may only worsen – even after the lockdown has been lifted. “ 

“Our duty is to safeguard human lives,” says Le Roux, “and if we want to protect them from economic fallout, we need to find a way to open the economy quickly, safely and sensibly.” 

The plan, which has already been supported by prominent economists Dawie Roodt and Mike Schussler, entails a new risk-based approach to opening up the economy. 

Sakeliga believes that Government’s existing approach was fundamentally flawed. Attempts to identify “essential” goods and services have posed a number of problems – and have opened Government up to a great deal of criticism. 

“The problem with Government’s approach to date is that it had to expressly permit specific sectors of the economy to operate. An economy – and the needs of the people who live within it – is, however, far too complex to allow for this kind of regulation.” 

“The result of this policy was Government banning baby clothes, prohibiting the sale of warm foods, reversing itself on some decisions and then – on days’ notice – re-reversing itself again. This was bad enough during the lockdown, during which only certain businesses were permitted to operate. Can you imagine the chaos if you tried to govern an entire economy in this way?” 

In terms of the policy-proposal, rather than identifying “essential” goods and services, Government would only be called upon to determine risky behaviours – such as failing to adhere to social distancing, or inadequate protective equipment for staff. 

Sakeliga stated that the policy would represent a way for Government to do its duty in limiting risk, whilst still relying on the private sector for creative solutions. Business who could eliminate risky behaviour would be permitted to operate – or, if unable to do so, would remain closed. 

“Ultimately, Government’s failure was based in the fundamental impossibility of distinguishing between that what is essential and what is not – because almost everything is essential to someone at some point. Anything from lightbulbs, to baby clothing, to warm coats, prepared food or electronics might be vital in your particular circumstances.” 

“The private sector has a great deal to contribute in this time of crisis. There are a great number of needs to be balanced and served.”  

” No regulations could ever be long and convoluted enough to deal with all the variables involved – and, even if they were, they would be far too complex to implement,” Le Roux concludes. 

Read the policy here. 

Issued by Piet le Roux, CEO,Sakeliga, 22 April 2020