South Africa Lifts Its Alcohol Ban as Coronavirus Crisis Eases

(Bloomberg) --

South African President Cyril Ramaphosa scrapped a ban on the sale of alcohol and tobacco and relaxed other lockdown restrictions as the nation’s coronavirus crisis eases.

The country, which in late March implemented one of the world’s strictest lockdowns to curb the spread of Covid-19, will move to so-called alert level 2 on Monday, enabling most restricted economic activity to resume, Ramaphosa said in a televised address to the nation on Saturday.

“We are making progress in our fight again Covid on a number of fronts,” Ramaphosa said. “Amid the signs of hope, we are ready to enter a new phase in our response to the pandemic.”

Bans on inter-provincial travel and social visits will be lifted, and restaurants and bars will be allowed to reopen. Alcohol sales for on-site consumption will only be permitted until 10 p.m., and for home consumption from Monday to Thursday. Restrictions on international travel, gatherings of more than 50 people and a night-time curfew will be retained, while spectators won’t be allowed at sporting events.

South Africa has recorded the highest number of coronavirus cases in Africa and the fifth-most in the world, with a cumulative 583,683 cases diagnosed so far. There have been 11,667 confirmed fatalities. New cases have been trending lower since late July.

The virus appears to have peaked in four of the nine provinces, and hospital admissions and demand for tests declined in recent weeks, Ramaphosa said.

“South Africa has reached the peak and moved beyond the inflection point of the curve,” he said. “It remains our foremost concern in the weeks and months ahead, to continue to save lives.”

Bans on alcohol and tobacco sales were imposed on March 27, measures the government said were necessary to reduce pressure on trauma wards and limit respiratory diseases. While sales of alcohol for home consumption were allowed to resume on June 1, the ban was reimposed on July 13 after trauma admissions surged.

Lost Revenue

Alcohol and tobacco producers and retailers have complained that restrictions have resulted in thousands of job losses, encouraged illegal trade and cost the government billions of rand in tax revenue.

“Lifting of the prohibition on the sale of alcohol will come as a welcome relief for our business and industry,” Zoleka Lisa, vice president of corporate affairs at Anheuser-Busch InBev NV’s Johannesburg-based unit South African Breweries said in a statement. “Over 1 million livelihoods depend on the alcohol industry’s value chain.”

The central bank and National Treasury both expect the economy to contract more than 7% this year as a result of the lockdown. Most curbs were lifted on June 1 to allow millions of people to return to work.

Ramaphosa said the government is working with business and labor groups on an urgent recovery plan that will complement an already announced 500 billion-rand ($29-billion) support package, with details to be unveiled in the next few weeks.

“The further easing of restrictions presents us with the greatest opportunity since the start of the pandemic to breathe life into our struggling economy,” he said. “Even as we open up economic activity, it will take a long time for industries and businesses to recover and there is much work still to be done.”

Other highlights:

• Over the last three weeks, the number of confirmed Covid-19 cases has dropped from more than 12,000 a day to about 5,000.
• The country has about 105,000 active virus cases, with about 80% of those who were diagnosed with the disease having recovered.
• The number of hospitalized Covid-19 patients has plummeted to about 4,000, from 10,000 at the start of this month.
• The government has extended a state of disaster by a month until Sept. 15.

©2020 Bloomberg L.P.