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The longer govt's recovery plan takes, the bigger the economic crisis - experts

Financial experts are extremely concerned that half a year has gone by since President Cyril Ramaphosa first introduced the lockdown and yet there is still no adopted economic recovery plan.

President Cyril Ramaphosa on 27 August 2020 appeared before the National Assembly in a hybrid plenary session to answer these questions presented for oral reply. Picture: @PresidencyZA/Twitter

JOHANNESBURG - Financial experts are extremely concerned that half a year has gone by since President Cyril Ramaphosa first introduced the lockdown and yet there is still no adopted economic recovery plan.

The business sector is warning that with further delays this can lead the country into a further dark hole.

Economists are concerned about a much deeper recession than predicted earlier in the year.

"Not fixing an airplane mid-air when there are problems and just flying in hope that it will fix itself."

This is how economist Dr Iraj Abedian sees government’s approach to the parlous state of South Africa’s economy.

And the longer government takes to agree on a recovery plan, the bigger the crisis gets.

"There will be a much deeper recession. Instead of being 8%, it might end up being 12%, 14%, 15%, and with that more poverty."

Businesses are equally frustrated as Business Leadership South Africa's CEO Busisiwe Mavuso points out.

"We came into the lockdown already in a weak position, when we as the business sector, have been jumping up and down for the last two years."

In recent weeks, President Ramaphosa has announced that business and social partners had submitted their ideas for recovery plans which will be integrated into one overarching plan.

But that plan still needs to be approved by Cabinet and it remains unclear how much longer South Africans will have to wait.

Meanwhile, the South African Medical Research Council's CEO, Professor Glenda Gray, said several that lessons had been learnt on the medical front during these six months, one being that the country could have scaled up testing much earlier.

"There was a global shortage of reagents and the National Health Laboratory Service had to scale up testing and it did take time. Maybe that's a lesson for the future."

Educational expert Professor Mary Metcalfe said that the lockdown had also been a wake-up call for many realising how many children did not have access to clean water in schools.

"We now need to, as South Africans in all of our provinces, work closely with the respective MECs or Education to monitor what is happening to the infrastructural backlogs in water and sanitation in particular."

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