Times Of Swaziland: CONSIDER 2020 A GAP YEAR - SARFED

CONSIDER 2020 A GAP YEAR - SARFED
================================================================================
BY SABELO MAJOLA on 12/05/2020 00:01:00


MBABANE – The Southern African Research Foundation for Economic Development
(SARFED) has recommended that 2020 be considered a gap year or a base year.
SARFED Regional Coordinator for Southern Africa Dr George Choongwa said the year
would be one in which innovative and strategic governance would be adopted by
government for sustainability purposes.
According to the organisation, a gap year is a prolonged economic situation of
either poor productivity or completely shut down.
Choongwa said this situation has a potential of having a permanent negative
economic ripple effect.
He said the fact that the country was uncertain when the pandemic would be clear
and resumption of normality, it is in right thinking that the entire year of
2020 be considered a gap year or a base year.
Losses
He said some of the immediate impact of COVID-19 in Eswatini include massive job
losses, especially for workers in the textile and hospitality industries.
He submitted that in the past two months, the country witnessed a not less than
8 000 jobs being suspended due to production failure and this was likely to
cause a recession if not addressed, and  might lead to stagnation.
“At the moment we cannot say that the country is under recession due to the
fact that it must take about two to three consecutive records of negative
economic growth. However, we can expect this to manifest in the event that the
pandemic continues up to December,” he said.
Below are some of the submissions and recommendations made by SARFED:
l     COVID-19 more than the previous financial crisis: SARFED has observed that
due to the latest outcome of the pandemic in the country and the world at large,
this might exceed the global 2008-2009 financial crisis. In this regard, workers
and businesses face catastrophe without urgent, coordinated measures by
governments and its stakeholders.
l     2020, Gap year for innovative governance: A gap year is a prolonged
economic situation of either poor productivity or completely shut down. This
situation has a potential of having a permanent negative economic ripple effect.
The fact that the country is uncertain when the pandemic will be clear and
resumption of normality, it is in right thinking that the entire year of 2020 be
considered a gap year or a base year where innovative and strategic governance
would be adopted by government for sustainability purposes.
l     Domestic workers might need to be compensated: Domestic workers might need
to be recognised during the pandemic. Despite the fact that they fall under the
informal sector, it is important to state that these workers equally form a
majority percentage of the workforce in the urban areas.  Nearly every household
in the urban areas employs a domestic worker, making the sector highly viable of
which its suspense has the possibility of leaving a huge unemployment gap.
Government can consider finding a mechanism of how this sector can be
compensated as a form of social security.
l     Higher possibility for higher poverty levels: Without appropriate policy
measures despite the fact that the pandemic took government and other
development sector abruptly unlike the normal recession process, there is need
for the engagement of pro- poor measures to save the masses from facing abject
poverty  due to limited or close down business which has subsequently led  to
mass job loss.
This is already to the current challenge that the country’s level of
inequality is at about 49 per cent, making it the 10th highest income inequality
in the world. Most of the employees especially those in the private sector  face
a high risk of falling into poverty and will experience greater challenges in
regaining their livelihoods during the recovery period, making them even poorer.
With the current poverty rate in Eswatini which remained stagnant at about 40
per cent over the period of five years, with specification of about 60 per cent
of the poorest living in the rural communities is likely to go up considerably
as long as the pandemic continues with less interventions in place.