Unrest affects South Africa’s economic recovery – reserve bank

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A police officer detains a suspect looting a shop in Johannesburg, South Africa, on July 12, 2021. Soldiers have been deployed in KwaZulu-Natal and Gauteng provinces to deal with violent protests and looting, the South African army said on Monday. Police said six people were killed and 219 people arrested over the weekend in Gauteng and KwaZulu-Natal following violent protests after former president Jacob Zuma was jailed for 15 months for contempt of court. Hundreds of shops and businesses across the two provinces were looted. (Photo by Yeshiel/Xinhua)
A police officer detains a suspect looting a shop in Johannesburg, South Africa, on July 12, 2021. Soldiers have been deployed in KwaZulu-Natal and Gauteng provinces to deal with violent protests and looting, the South African army said on Monday. Police said six people were killed and 219 people arrested over the weekend in Gauteng and KwaZulu-Natal following violent protests after former president Jacob Zuma was jailed for 15 months for contempt of court. Hundreds of shops and businesses across the two provinces were looted. (Photo by Yeshiel/Xinhua)

The recent unrest would affect investor confidence and the country’s economic recovery, said the South African Reserve Bank governor Lesetja Kganyago on Thursday when announcing the decision of the Monetary Policy Committee on Repo Rate.

“We estimate the unrest to have fully negated the better growth results from the first quarter, resulting in an unchanged estimate of 4.2 percent for growth in 2021. Their impact on vaccinations, a longer than expected lockdown, limited energy supply and policy uncertainty pose downside risks to growth,” he said.

“There is no doubt the unrest disrupted the supply chain and affected logistic framework, investor confidence, domestic and international,” Kganyago added.

He said, “The direct and indirect costs of recent events will likely further slow South Africa’s economic recovery. Although some sectors, notably mining and manufacturing have largely recovered to pre-pandemic levels, production remains muted in sectors harder hit by the pandemic and in regions now affected by the unrest. Recent unrest and economic damage could have lasting effects on investor confidence and job creation. ”

A large number of businesses were looted, burnt or vandalized during rioting that broke out after the imprisonment of former South African president Jacob Zuma. Enditem

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