South Africa faces negative economic impact as unrest rock country

SOUTH AFRICA – South African retailers have been left counting losses after sporadic incidents of protests in KwaZulu-Natal and Gauteng, have resulted in widespread looting and disrupted the supply chain, raising concerns of a potential shortage of basic consumer goods in SA.

The loss to retailers, including the cost of damage to property and delivery vehicles, runs into millions of rand, the Consumer Goods Council of SA (CGCSA) has indicated.

The CGCSA has condemned the unfortunate incidents of unrest saying such acts of wanton criminality have no place in democratic South Africa.

“Looters are targeting retail shops including liquor stores and have stolen merchandise which includes food stuffs, electrical products and clothing.

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“CGCSA is particularly concerned about the potential impact of the disruptions on food security in the country and various supply chain issues. This is because factories will not be able to produce, resulting in food shortages, which will affect the most vulnerable and poor most,” the organization indicated.

The potential impact on business viability and job security is also a serious cause for concern.

CGCSA is further worried that the disruption to business activity and destruction of commercial property will delay the recovery of the economy from successive lockdown restrictions and also affect the already fragile investor and business confidence.

“The fact that the government has extended the lockdown for another 14 days, with liquor sales remaining banned, is not helping the situation and will worsen the financial crisis facing liquor retailers and those in the value chain,” stated CGCSA.

Furthermore, the disruption to and closure of key transport routes can potentially affect the supply chain of retail products which could in turn create shortages of basic commodities throughout the country.

“After the ransacking of retail stores, the warehouses of liquor companies and distributors had become the primary target of looting and vandalism.”

Salba Chief Executive – Kurt Moore

To this end, the CGCSA has appealed to the government to urgently provide effective protection to its retail, manufacturing and services sector members, and to provide for the safe passage of delivery vehicles and employees, in restoring the supply food, pharmaceutical and medical supplies to areas affected by looting.

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Other than the retail sector, the alcohol industry has also bore the brunt of the protests, with the South African Liquor Brand Owners Association (Salba) and National Liquor Traders (NLT) indicating that stores of more than 200 of Salba’s members have been targeted and looted.

Stock worth millions of rands at warehouses and retail premises across KwaZulu-Natal and Gauteng has been stolen and stores damaged.

“After the ransacking of retail stores, the warehouses of liquor companies and distributors had become the primary target of looting and vandalism. Our big concern is that the focus is now shifting to our primary production sites (breweries and distilleries), where high-volume pre-production alcohol is stored.

“Any attack on these sites poses a serious safety risk for our security personnel on site, as well as looters and surrounding communities,” Salba chief executive Kurt Moore said.

Meanwhile, sugar mills in Kwazulu-Natal, the main sugar growing area have closed after cane trucks were hijacked.

The country’s main agricultural body AgriSA, has indicated that around 300 000 tonnes of cane to date have been burnt.

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