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The COVID Project

 

ERSA, in collaboration with the German Development Cooperation (GIZ) and the International Food Policy Research Institute (IFPRI), has been working on an exciting new project aimed at developing economic policy in a post-COVID-19 South Africa. We find ourselves in a complex position after the public health response in South Africa, in an effort to protect its citizens, pursued an aggressive lockdown and social distancing strategy. But this has left many businesses operating in an environment constrained by weakened demand, supply-side bottlenecks and a compromised labour market. With such a profound impact on our economy it is important to raise questions of whether our policy responses have been appropriate for the South African context, and what the policy going forward should entail.

The Covid Project will be unfolding over the next few months, approaching these questions in four broad themes. Expert researchers from throughout the country are drawn together to unpack these complex issues comprehensvely. As the project unfolds, it will provide context to the current economic environment with a view to building a roadmap to guide South Africa’s economy to recovery.  The four themes to be explored are:

  • Part 1: Monetary Policy
  • Part 2: Labour Market Policy
  • Part 3: Trade Policy
  • Part 4: Building back for a sustainable future

 

 

Theme

Monetary Policy

Join ERSA, in conjunction with German Development Cooperation (GIZ) and the International Food Policy Research Institute (IFPRI) in a discussion on monetary policy in South Africa.

The discussion is based on Sailing into the Wind: evaluating the (near) future of Monetary Policy in South Africa, by Tumisang Loate, Ekaterina Pirozhkova and Nicola Viegi, that explores how monetary policy seeks to maintain price stability in the emerging post-COVID economic environment:
• What are the underlying constraints that affect monetary policy making?
• What constraints are facing the central bank?
• How has the SARB’s monetary policy framework evolved to accommodate these?
• Is inflation targeting an appropriate monetary policy framework given the unprecedented levels of uncertainty?
• What role do balance-sheet policies have in maintaining price stability?

 

Podcast

Sailing into the Wind: evaluating the near future of monetary policy in SA

Thu, 24 June 2021

Only three times in the last century has monetary policy been re-evaluated and tested to its limits. This global pandemic has forced many central banks around the world to use non-conventional...Read more

Authors
Tumisang Loate

Tumisang Loate

Ekaterina Pirozhkova

Ekaterina Pirozhkova

Nicola Viegi

Nicola Viegi

Publication

Sailing into the Wind: evaluating the (near)future of Monetary Policy in South Africa

This paper evaluates the main challenges facing South African monetary policy. We focus on three main issues: the external environment, the growth potential of the economy and its fiscal balance. The external environment will remain uncertain and volatile and South Africa monetary policy should...

Apr 2021
Theme

Labour Market

Join ERSA, in conjunction with German Development Cooperation (GIZ) and the International Food Policy Research Institute (IFPRI) in a discussion on labour market policy in South Africa.

The discussion is based on two research papers: Recovering from COVID-19: Economic scenarios for South Africa by Dirk van Seventer, Channing Arndt, Robert J. Davies, Sherwin Gabriel, Laurence Harris, and Sherman Robinson and Addressing low labour utilisation in South Africa, by Christopher Loewald, Konstantin Makrelov and Andreas Wörgötter (see below) that explores the main challenges facing the South African labour market. Increasing labour utilisation requires a novel approach to sustainable employment creation, which moves away from policies that serve certain groups at the expense of the unemployed.

• How is the Covid-19 recovery affected by the low labour utilisation and high unemployment rates in SA?
• Is the low economic growth here to stay?
• Is the labour market acting as the primary constraint to economic growth?
• What are the reasons behind the low labour utilisation rate in South Africa and how is this different to other emerging countries?
• Which parts of society are bearing the brunt of the this?
• Can we achieve sustainable wage growth?

Podcast

Prof Andreas Wörgötter on addressing current and persisting challenges in South Africa’s labour market

Thu, 15 July 2021

At a time when tensions are rising due to growing inequality and unemployment, ERSA’s host...Read more

Authors

Christopher Loewald

Konstantin Makrelov

Andreas Wörgötter

Publication

Addressing low labour utilisation in South Africa

South Africa’s stubbornly low labour utilisation rate is an international outlier and a heavy brake on the ambitions for growth and redistribution published in various strategic policy strategies (National Planning Commission 2013). More immediately, low labour utilisation is a major obstacle to...

Jun 2021
ERSA The Covid Project banner
Theme

Trade Policy

 

Join ERSA, in conjunction with German Development Cooperation (GIZ) and the International Food Policy Research Institute (IFPRI) in a discussion on labour market policy in South Africa.

The discussion will be based on two papers: Covid-19 and Lockdown Policies: A Structural Simulation Model of a Bottom-Up Recession in Four Countries by Sherman Robinson, Stephanie Levy, Victor Hernández, Rob Davies, Raul Hinojosa, Sherwin Gabriel, Channing Arndt, Dirk van Seventer, and Marcelo Pleitez and Understanding South Africa’s trade policy and performance by Matthew Stern and Yash Ramkolowan (see below).

Improving South Africa’s international competitiveness requires both an understanding of the constraints facing the manufacturing and export sectors as well as a novel approach to trade negotiations.

•How can the impact of Covid-19 pandemic shocks and economic stimulus packages be modelled?
•How are structural issues accounted for in different modelling strategies?
•As a small, open economy heavily dependent on imports and commodities, what role does South Africa play in Africa?
•Why has South Africa’s external competitiveness declined?
•What role do trade and industrial policy play in addressing South Africa’s poor trade performance?

Podcast

Dr Matthew Stern on understanding South Africa’s trade policy and performance

Tue, 03 August 2021

An issue often overlooked in many discussions is that of exports and trade in the South African economy. But with a downward trajectory over the past 20 years having indirectly cost our general...Read more

Authors

Matthew Stern

Yash Ramkolowan

Publication

Understanding South Africa’s trade policy and performance

South Africa’s exports have lagged behind the rest of the world over recent decades, and this has likely constrained overall economic growth. There are multiple reasons for this disappointing trade performance, including the structure of the country’s export basket (which remains dominated by...

Jun 2021
Theme

Building back for a sustainable future

Join ERSA, in conjunction with German Development Cooperation (GIZ) and the International Food Policy Research Institute (IFPRI) in a discussion on building South Africa's economy back sustainably post pandemic. 

The discussion is based on two papers: "Building back fairer from the COVID-19 pandemic in South Africa: Some first step reforms in an era of fiscal constraints", by Channing Arndt, Robert J. Davies, Sherwin Gabriel, Laurence Harris, Michael Sachs and Dirk van Seventer and "Building a competitive and dynamic green industrial sector in South Africa" by Tendai Gwatidzo and Witness Simbanegavi (see below). 

While the former focuses on skills, food systems, nutrition and health, and urban structure, the latter focuses on the importance of green energy for a sustainable future. Together, these papers explore how we can use our existing infrastructure and fiscal environment to become more efficient in the short run and work towards a green sustainable economy in the long run. Looking forward requires an honest reflection of the learnings from the past, and a concerted effort to prioritise green energy.

• How dependent is future growth on green industrialization policies?
• Can we shift electricity production from coal to renewables without compromising short term economic growth and employment?
• In the context of the pandemic and increasing climate change, can SA leverage green technology and lead Africa in producing green output?
• Given the tight fiscal position, how can growth be pursued such that policies are less dependent on investment in the short run?
• How can we use the pandemic learnings as an opportunity to leapfrog the South African economy towards a long-term sustainable future and overcome the trajectory we were on prior to the pandemic?

Podcast

Building back fairer from the Covid-19 Pandemic in South Africa

Thu, 18 November 2021

Post-pandemic, South Africa’s economy finds itself in a constrained fiscal environment...Read more

Authors

Tendai Gwatidzo

Witness Simbanegavi

Publication

Building a competitive and dynamic green industrial sector in South Africa after COVID-19

COVID-19 gave the world a glimpse of how devastating a pandemic can be to economies and livelihoods. Climate change, given its permanence, would be far more devastating, hence the renewed efforts at the global level to mitigate climate change. South Africa, one of the dirtiest producers in the...

Jun 2021