South Africa: Covid-19 Has Taught Us Critical Lessons About Feedback in Systems

opinion

While the change in South Africa's GDP because of Covid-19 tells us that we're a fifth poorer compared with this time in 2019, we are confronted by the question: What are the potential long-term system-wide ramifications of the way in which the virus has been managed? What are the feedback loops?

The streets fell eerily quiet in March. While few ventured a number as to the price tag associated with this ill-surprised stillness, we all knew that it was going to be big, but how big? Now we know. The South African GDP in real terms for the second quarter of 2020 is estimated at R654-billion compared to R762-billion in the first quarter and R788-billion in the second quarter of 2019. This implies a decline of R135-billion, or 17.1% on a second-quarter to second-quarter basis.

When averaging it out for the country it means that we are almost a fifth poorer, financially that is, than we were last year this time. This 17.1% is in contrast with the well publicised 51% decline, a subject of much debate. While technically and factually correct on an annualised basis, the figure of 51% does overinflate and distort the actual case by some margin....

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