The recent unrest in South Africa which was triggered earlier this month in the wake of former President Jacob Zuma’s imprisonment, would affect the country’s economic recovery, Finance Minister Tito Mboweni said.
Addressing an online press briefing on Wednesday, Mboweni said the two-week unrest, which resulted in widespread destruction and looting, would impact future gross domestic product (GDP), business confidence and reduce private investment.
“This will constrain economic recovery at a time when business confidence is already weak and at levels last seen in the fourth quarter of 2014,” he said.
Mboweni said that damage to property will cost Sasria between R15 billion to R20 billion ($1-1.35 billion) in claims.
Sasria is a state-owned company and the only short-term insurer that provides cover to all the people and businesses that have assets in South Africa, as well as government entities, against special risks such as civil commotion, public disorder, strikes, riots and terrorism.
“There is widespread damage to shops and malls, network towers, post offices, factories, roads and freight trains. Hundreds of ATMs have been destroyed, making access to cash harder,” he said.
Mboweni said the National Treasury was projecting that the country’s economy would only return to pre-pandemic levels in the fourth quarter of 2023.
The unrest, that started on July 7, in the eastern provinces of KwaZulu-Natal and Gauteng led to thousands of businesses and infrastructures being looted and burned.
At least 337 people have died since, while more than 2,500 people have been arrested in connection with the violent protests.
Zuma, once known for his fight against apartheid, has been imprisoned in the Estcourt Correctional Centre for 15 months for disobeying court orders.
He did not testify before the judicial commission that was investigating accusations of corruption against him between 2009-2018.