Virus lockdown plunges South Africa deeper into recession

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A homeless man stands at a street corner in Johannesburg, Wednesday July 22, 2020. Official statistics show that South Africa's economy has sunk deeper into recession, with its gross domestic product for the second quarter of 2020 plummeting by 51%, largely as a result of COVID-19 and the country's strict lockdown. (AP Photo/Denis Farrell)

JOHANNESBURG – South Africa’s economy has sunk deeper into recession, with its gross domestic product for the second quarter of 2020 plummeting by 51%, largely as a result of COVID-19 and the country's strict lockdown, according to statistics released Tuesday.

South Africa imposed one of the strictest lockdowns in the world in April and May in response to the coronavirus outbreak, which has now claimed more than 15,000 lives and infected 639,362 people in the country.

The halt to most economic activity during the shutdown caused heavy declines in South Africa's manufacturing, transport and retail sectors, according to the country’s statistics body StatsSA. South Africa has one of the largest and most developed economies in sub-Saharan Africa.

The country’s ban on trade in liquor and cigarettes also had an adverse impact on the economy during the period from April to June, with consumer spending on these items falling by 92%, according to StatsSA. South Africa’s manufacturing output shrank by 74.9% as factories stopped production, it said.

“Air travel came to a complete halt, contributing to the fall in economic activity in the transport and communication sector," said the report. “The retail ban on alcohol sales and closure of tourist accommodation facilities were notable drags on trade activity."

Some economists have warned that even though the COVID-19 outbreak was to blame for most of the decline, it simply exacerbated the economic crisis that South Africa was already experiencing.

South Africa’s unemployment rate is now at a record high of 30.1 %.

Since June the country has eased lockdown restrictions and gradually reopened the economy that is expected to decline by 7.2% this year, according to government projections.