Message from the USB Alumni Association – COVID-19: Wins, losses and opportunity

By Dr Xolani Nocanda

Chairperson: USB Alumni Association: KwaZulu-Natal

 The coronavirus outbreak in December 2019 in China has not only affected public health; it has changed societies and economies around the globe. By March 2020 it was clear that COVID-19 had become a global health crisis; hence World Health Organization (WHO declaring it a pandemic. Hitherto there has been no convincing medical treatment for the virus, and many think a cure is possible in 2021. People are currently required to follow the stated COVID-19 protocols to prevent themselves from being infected. Following the COVID-19 protocols such as social distancing means that people should change their behaviour and lifestyles.

Changing people’s responses cannot be achieved overnight; hence infection and death rates continue to rise globally. Due to the pandemic societies are experiencing losses. Losses due to the pandemic cannot be avoided or reversed; communities are forced to face and deal with their losses. As the COVID-19 infection increases, companies experience an increasing number of sickness, consequently resulting in loss of productivity and later business. Despite the negative economic impact, new business opportunities exist. Businesses are required to learn to do business in the presence of COVID-19 while positioning themselves to take advantage of opportunities brought by the pandemic.

The USB Alumni Association Chapter: KwaZulu-Natal recently invited experts from academia and industry to discuss wins, losses and opportunities caused by the COVID-19 pandemic. USB’s Prof Arnold Smit addressed the impact of COVID-19 on leadership and how to deal with our losses. Maarten Ackerman, who is the Chief Economist and Advisory Partner at Citadel, focused on the economic implications of COVID-19, unpacking future economic outlook.

The first case of COVID-19 in South Africa was reported in early March 2020. By the end of March, the South African government declared a lockdown level 5 due to the rapid spread of the virus. The lockdown would delay the spread to better prepare public and private healthcare to cope with the number of infections. The lockdown would save people from rapid infections; on the other hand, it harmed the economy. Businesses were forced to shut down except the essential services. As the number of infections and deaths increases governments around the globe are faced with a hard choice between saving public safety and the economy.

The COVID-19 brought many losses, and these include loss of family members, friends, freedom, health, business, security, socialisation and meaning to life. Due to these loses society is feeling uncomfortable. The discomfort that society is feeling, experts define as grief. In lockdown level 5 people could not move around; during this time, South Africa recorded an increase in domestic violence, an indication of discomfort in society. Upon testing positive for COVID-19 people are required to quarantine for 14 days.

The isolation combined with fear of losses mentioned earlier would increase stress levels resulting in a mental health crisis. South African Depression and Anxiety Group (SADAG) is reporting an increase in the number of calls during the lockdown period. According to SADAG, people are dealing with anxiety and panic, financial stress, pressure, depression, poor family relations, feelings of suicide and substance abuse. Despite the grief that society is undergoing, the World Health Organization is warning people from substance abuse as a way to relieve stress. Health care professionals are at high risk of being infected since they work with COVID-19 infected patients daily. Health care workers can easily experience burn out, fatigue and trauma due to increased workload. A healthy coping mechanism is required for all. Society needs to adjust to a new normal, which involves co-existence with COVID-19.

Before the COVID-19 outbreak, many developing economies around the globe were experiencing weak economic growth. The situation has been made harder by the emergence of COVID-19. Policymakers need to address the current health crisis while finding ways to minimise financial damage. Before COVID-19 unemployment rate in South Africa was estimated at around 30%. During the lockdown, it was reported that an estimated 3 million people might have lost their jobs. Most job losses are recorded among the underprivileged communities. Hence there is an urgent need for governments to take action to protect the vulnerable population.

Global gross domestic product is expected to contract by an estimated 5%, while South Africa is expected to contract by 7% in 2020. Many think South Africa could reach depression, a gross domestic product contraction of 10% or more. Economic stimulus measures are needed to reignite economic growth. The South African government launched an R500 billion stimulus package. The money will be spread to support health in fighting COVID-19,  support municipalities for the provision of basic services, help people affected by COVID-19, provide grants to unemployed, support small businesses and prevent job loses. In line with other central banks, the South African Reserve Bank (SARB) has reduced interest rates, and more cuts are expected in future. To further inject liquidity into the market, the SARB is on a short-term bond-buying programme.

COVID-19 has forced companies to spend on personal protective equipment (PPE), cleaning and hygiene products to ensure the safety of employees. This unplanned expenditure at a time when production was already decreasing, could be adding financial pressure. Businesses that produce PPE and hygiene products do benefit in the short term, but they are a minority. Most companies, however, are experiencing losses due to increased absenteeism and skills-erosion due to deaths. Owing to COVID-19, companies are being forced to consider new ways of doing business. Business activities are becoming more digital, and employees are working from home. Many predict that technology will remain at the heart of business activities post the COVID-19 pandemic.

COVID-19 may not be around for many years. However, its economic impact will be felt for a long time. Investors are advised to stick to their investment philosophies focusing on the right assets in the correct type of investments. Businesses are experiencing losses, those that are suppliers in technology could be winners as most business activities are going online.

Leading during COVID-19 has been challenging for many, one must strike a balanced between the health of employees and profit. Leaders need to be mindful and understanding of people’s situations during this time, encouraging employees to follow COVID-19 protocols. Proposed coping mechanisms are:

• If negative news affects, minimise exposure
• Keep communication with family, friends, social media etc.
• Stick to your entertainment ways, e.g. music
• Sleep enough
• Eat healthily
• Exercise

Professor Abdul Salim Karim, who is the chairperson of COVID-19 South African government ministerial advisory committee, believes that Ubuntu will save South Africa from the COVID-19 pandemic. Ubuntu is an African concept meaning taking care of one another. To defeat COVID-19 South Africans need to take care of and protect one another.

Wishing all alumni a safe and thriving journey.