Post-Covid-19 South Africa: A possibility or myth?

By:  Stef Terblanche.

When trying to answer the question in the title, one first has to consider just how wide Covid-19 touched and disrupted what we previously took for granted as everyday or normal life – from health, to science, to politics, governance, economics, climate, business, crime, education, and in fact everything else. Nothing, it seems, was left untouched.

Yet, when considering what might come “after” Covid-19, we cannot view the pandemic in isolation and separate it from other already existing events and processes that are having profound impacts on the world and on South Africa. It certainly has been an immense disrupter and seems to have exacerbated the immense challenges we already faced before its arrival.  But in itself it’s not the alpha and omega.

However, the pandemic and the way South Africa – and other countries – responded to it, did expose fundamental weaknesses and failures in our societal, political and economic structures and systems. And while we may even develop a cure or a vaccine for Covid-19 and downgrade its future threat level to that of the common flu, polio or chickenpox, this pandemic did alert us to the danger and devastating impacts of such events. As a result, much if not everything we undertake in the “post-Covid-19” era, will be done through the lens of such a devastating potential pandemic.

Whether in the health/medical science sense there will be a “post-Covid-19” South Africa or world, depends on finding a vaccine or a cure or annihilating the virus altogether. Those remain unanswerable for now.

Beyond the medical / health view

Outside public health and medical science context, to attribute all future change to Covid-19, whether in a post-Covid context or not, and to imply some mythical “new normal”, is to negate somewhat the already existing processes of rapid change brought about by the 4^th industrial / technology revolution and impacts of and responses to climate change.

There are sub- or other processes and sub-texts as well that will play a part. For instance, the sudden explosion of protests in the US and around the world against police brutality and racism, may in part have been accelerated by the impacts of Covid-19.  But that’s a subject for another day.

Covid-19 involuntarily and unforeseen inserted itself as a new element in already ongoing processes of vast global change. Ditto South Africa. To what extent Covid-19 will influence, retard or accelerate those concurrent processes of change, no-one knows at this stage. But to talk exclusively of a post-Covid “new normal” is to ignore the impacts of global and domestic change brought about by these other processes. One is not separable from the other, but Covid-19 may serve to accelerate the overall process of change as we go forward.

The current Covid-19 pandemic should not be regarded as the watershed event in the history of the world and humankind, but simply as another watershed event with a “before” and “after”. And as pointed out, we were already moving into the “new normal” before Covid-19 and at best the pandemic may accentuate certain responses and accelerate others.

We have been here many times before in the history of the world and of South Africa, when a “new normal” followed disruption, catastrophe, evolution, innovation or development. The “new normal” is simply the consequential change, adaptation and adjustment that follows. Such historic global disruptive events have included the rise of Christianity or Islam; the invention of the printing press; two World Wars; trans-Atlantic slavery; the 1^st industrial revolution; and many previous major plagues and pandemics throughout history.

In South Africa, apart from the impacts of global events, previous disruptions that brought about significant domestic change in every sphere of society included the Mfecane triggered by Shaka’s forging of a new militaristic and dominant Zulu kingdom; the European colonisation of South Africa; the rise of Afrikaner nationalism and apartheid; various health epidemics such as the pox outbreaks and later HIV/AIDS; the Sharpeville massacre, the 1976 student uprising and the 1994 transition to democracy; among others.

From a social, economic, technological and political perspective, there will definitely be pre-Covid and post-Covid eras globally and in South Africa. But the dividing line between the two eras will not be very clear on the Covid-19 timeline. Post-Covid-19 may start when the virus is largely contained or controlled, or when a vaccine or cure has been found, or when lockdowns are ended but the virus is still around.

Which brings us to answering the question: Post-Covid-19 South Africa: A possibility or myth? Leaving the medical defeat or containment of Covid-19 aside and focusing on the social, economic, technological and political aspects only, the answer is, yes, there will be a post-Covid-19 South Africa. But it’s less a question whether a post-Covid South Africa is possible, and rather more a question of what will be possible in a post-Covid South Africa.

Quo Vadis post-Covid South Africa?

The Covid-19 pandemic and our national lockdown has provided South Africa with a window on some of the possible developments in a post-Covid era. Let’s look at some of these and what to expect.

Economic recovery, reconstruction and transformation

The devastating economic cost of the Covid-19 lockdown and state of disaster declared by the South African government has yet to be calculated. The indications are already that the damage significantly surpasses the economic battering of the 2008 financial crisis. Guestimates differ wildly, but it seems anything between 2 million and 8 million jobs could be lost. Government was forced to increase spending – notably its R500 billion relief and Covid-fighting package – while at the same time it seems that tax revenues will decline this year by around R300 billion.

It is predicted that South Africa’s economy is will shrink by 7% according to the World Bank,  5,8% according to the IMF, 6,1 % according to the National Treasury and by as much as 8% according to some other estimates.

Government has just secured a loan for US$4,2 billion under the IMF’s Rapid Finance Instrument to facilitate part of its R500 billion Covid relief aid, and there is talk it will soon have to return to the IMF fort a much bigger loan. Indeed, President Cyril Ramaphosa has already said SA will have to consider borrowing from the IMF, New Development Bank or other institutions.

In the background noise in the ANC one still hears talk of raiding SA’s public and private pensions. New government debts and continued interest expenses on existing ones are nearing 40% of total government expenditure and could soon exceed 50%, which means there is a looming fiscal crisis. Some estimates are that the fiscal deficit will exceed 13% this year and public debt to GDP ratio could reach as much as 80% in 2021.

Whatever the final data may eventually be, we know already its impact will be huge in terms of aggravated poverty, thousands of lost jobs, many closed businesses and debilitating harm to those companies that manage to survive. State revenues will have been depleted and the debt situation aggravated. The South African economy was already in serious trouble when Covid-19 hit and drove a stake through its heart. Recovery will be very painful, slow, and even divisive, but not impossible.

Social compact required

So, rebuilding and transforming the economy will be paramount and will dominate all else. It will revolve around two concepts: structural economic reform and radical economic transformation. Even if the competing proponents of these concepts within the governing alliance (and also those outside of it) view them as being mutually exclusive in our domestic context, they are not necessarily so.

However, they will require an immediate social compact and consensus buy-in from currently adversarial forces, without the consensus-seeking delays of the last two-and-a-half years. That seems to be more possible now if, for instance, leaked information from the ANC is correct that COSATU and the SACP agreed to the government approaching the IMF for a loan after initially opposing the idea.

Some shared recognition of the worst socio-economic impacts of Covid-19 may drive better and broader cooperation, consensus and compromise in the post-Covid reconstruction of South Africa. But the destructive impacts of political and ideological competition will not have dissipated. In fact, there is ample scope for it to intensify at times, while all of the competing role-players, stakeholders, factions and agendas are still very much in the picture. To this can now be added a layer of authoritarian political tendencies in areas of government, facilitated by the state of disaster and the national lockdown, elements of which will not be easily reversed post-Covid-19 and will further complicate effective political decision-making.

The Covid-19 pandemic most dramatically laid bare the impacts of poverty and inequality, as well as the duality of our economic system – what former President Thabo Mbeki once referred to as South Africa’s two disconnected, mutually exclusive economies where the poor, the unskilled, and the illiterate could not access the mainstream economy. This will become a focal point of the economic reconstruction, but also a terrain of political conflict and competition.

The further anticipated impacts and the yet-to-arrive aftermath of the pandemic will forcibly bring home the need for accelerated action, but serious conflict is still likely to arise in finding an equitable balance between growth, reconstruction, reform, transformation and development. With depleted / limited financial resources, and even if the pensions piggybank is raided, external multilateral assistance will still be required and will become another point of conflict as it may seek to steer renewal, reconstruction and growth in directions not compatible with a number of existing domestic political agendas.

Focus areas

The pandemic has highlighted the plight and impacts of millions of South Africans living in abject poverty in informal settlements. As a result there is already emerging a strong emphasis on speeding up housing delivery together with the accelerated provision of water and sanitation. This will also be a jobs generator and will incorporate aspects of land expropriation, thus also satisfying some political demands.

During level 5 of the national lockdown Human Settlements, Water and Sanitation Minister, Lindiwe Sisulu, declared 136 priority human settlements and housing development areas across the country and also allocated tenders for new housing construction which got underway with unprecedented speed. One can also expect that major aspects of spatial planning and a more effective urbanisation strategy will be revisited.

Together with this municipal governance and delivery continues to pose a huge challenge. Addressing it may be complicated by the possible postponement of next year’s local government elections and aligning them with national/provincial elections, as well as some current moves to reform the entire electoral system. While these processes continue, by-elections may be necessary in some municipalities while one can anticipate an increase in municipalities placed under administration. Local government will continue to be a major pressure point.

So too will be Eskom and the energy sector that still pose a serious threat to South Africa, exacerbated by the Covid-19 induced brittle state of the economy. A strong focus on energy security will bring forth new initiatives, such as we are already seeing on the nuclear front. A major focus on improvements on the information technology front, including in education, are also likely to follow as we readjust towards a digital economy.

Finally, there will be concerted efforts by government to speed up and widen the implementation of a National Health Insurance (NHI) scheme. Ramaphosa has already said the government’s response to Covid-19 should be seen as a building block of the NHI. However, with both public and private health services’ stretched to breaking point and with the economy in dire straits, the financing of the NHI will become a major challenge that may cause it to be postponed yet again. There will also inevitably be more nuanced post-Covid discussion between the private health sector and government on finding equilibrium between them.

As President Ramaphosa said in his weekly newsletter, “the pandemic presents an opportunity to ‘reset’…” It’s a view shared throughout the ANC alliance but one that could intensify internal competition for political and ideological dominance during the reconstruction. But for now the focus seems to be more in favour of consensus and cooperation.

Stef Terblanche is a Cape Town-based political analyst/consultant and journalist. He provides political risk analyses to corporate, research, diplomatic and other clients for over three decades. He writes for DDP in his personal capacity and his views do not represent those of the organization.