In trying to limit the spread of COVID-19, policymakers globally have the difficult task of balancing the positive health effects of lockdowns against their economic costs, particularly the burdens lockdowns impose on low-income and food-insecure households.
In the case of South Africa, the lockdown policies are relatively stringent, and the economic impacts large.
We have estimated the impact of the South African lockdown on aggregate production of goods and services for final demand (gross domestic product, or GDP), earnings of different categories of labour (low to high skill), and incomes of household groups (poor to rich).
Because the source of food insecurity has resulted from a collapse in earnings, income transfers via social protection have been highly effective in countering the economic effects of lockdowns.
South Africa has begun a risk-based, alert-level approach to balance contagion risks and the economic consequences of lockdowns.
