South Africa Limits Alcohol Sales, Closes Beaches to Curb Covid

South Africa’s government will curb alcohol sales and close some of the nation’s beaches at the height of the summer-holiday season, among a series of new restrictions to rein in surging coronavirus infections.

The government declared the start of a second wave of the Covid-19 pandemic on Dec. 10 as the number of daily new cases doubled this month. The country is fast-approaching 1 million infections, with 866,127 people having contracted the disease so far, President Cyril Ramaphosa said on Monday.

“Given the rate at which new cases have grown over the last two weeks, there is every possibility that if we don’t act urgently and if we don’t act together, the second wave will be even more severe than the first wave,” Ramaphosa said in an address broadcast on state television.

The new measures include:

  • Restricting alcohol sales to 10 a.m. to 6pm from Monday to Thursday
  • Declaring the districts of Garden Route and Sarah Baartman along the south coast coronavirus hotspots
  • Closing beaches in the Eastern Cape province from Dec. 16 to Jan. 3 and in KwaZulu-Natal on the busiest days of the festive season
  • Extending the nationwide curfew to 11 p.m. to 4 a.m.
  • Further limiting the number of people attending public gatherings, with a maximum of 100 people allowed at indoor events, and 250 outdoors.

The renewed efforts to curb the spread of the virus may hamper the recovery of an economy predicted to contract the most in almost nine decades.

South Africa Limits Alcohol Sales, Closes Beaches to Curb Covid

The ban on large gatherings and limits on the sale of alcohol products are likely to weigh on jobs, particularly in the tourism and hospitality sectors that have been ravaged by restrictions on international travel. Businesses in coastal provinces have been counting on domestic tourism over the festive season, when trips by locals peak and tourists spend more than 25 billion rand ($1.66 billion) in December, according to statistics agency data.

“Although sensible measures, the new restrictions will still slice off a further layer of output, specifically from the alcoholic-beverage and tourism/hospitality industries,” said Elize Kruger, an independent economist. “Lower trading also equals lower tax revenue, while many seasonal jobs could also be in firing line.”

The restrictions may also add pressure on the government to extend temporary relief programs for vulnerable households, increasing state spending. That’s even the government seeks to reduce expenditure by about 300 billion rand over the next three fiscal years.

In determining its response to the current wave of infections, the government sought to balance the need to save lives and to protect livelihoods, Ramaphosa said. While a strict lockdown imposed at the beginning of the pandemic in March was designed to delay the spread of the virus and prepare its health systems, South Africa is now better prepared to deal with the increase in infections, he said.

“A full lockdown was absolutely necessary then to delay the pandemic, but would not serve the same purpose now and that is why we are not opting for that option,” Ramaphosa said.

What Bloomberg Economics Says...

“The impact of these new set of measures will be much lower than the hard lockdown we saw in April. This is good for the economy. However, the danger is that they fail to contain to the spread of the virus, necessitating even stricter measures down the line.”

-- Boingotlo Gasealahwe, Africa economist

©2020 Bloomberg L.P.

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