Businesses slam ‘backwards’ national shutdown

 ·16 Mar 2023

South African businesses have raised concerns regarding the national shutdown scheduled for next Monday, 20 March, saying the cessation of business activity will do far more harm than good.

The Economic Freedom Fighters (EFF) will lead the protest, with the African Transformation Movement and the SA Federation of Trade Unions (SAFTU) also joining.

There are multiple reasons touted for the shutdown, but the EFF is focusing on two main points: the resignation of president Cyril Ramaphosa and the nation’s energy crisis.

Although the organisations involved in the protests have not given the exact locations that the demonstrations will target, they have warned businesses and companies nationwide to shut down for the day.

There have also been threats of looting against businesses that remain open – despite the EFF’s claims that the protests will be lawful and peaceful.

As reported by BusinessDay, South Africa’s security forces have assigned a high-risk status to the planned shutdown to prevent a repeat of the July 2021 unrest – where over 300 people died.

A large contingent of the police force will be deployed, with the military and National Prosecuting Authority (NPA) on standby.

Business concerns 

Business experts have expressed worries over the planned protests, as they could directly impact the economy.

Speaking to Business Report, Frank Blackmore, lead economist at KPMG, said that the finicial cost of the shutdown could be huge.

“The impact will be felt in terms of lost time that would normally be used for productive efforts. In other words, contribution towards GDP. And then if there is any violence or damage to infrastructure, this would be an additional cost on top of the lost productivity time,” Blackmore said.

He added that the shutdown’s impact comes at a bad time for South Africa, with the country already facing numerous economic headwinds.

Business Unity South Africa (BUSA) also condemned the EFF’s warnings of violence against businesses that do not support the national shutdown.

It said that the right to protest is enshrined in the constitution, but it cannot infringe on the rights of others.

“Looting, violence, incitement, and intimidation are criminal acts that are not protected by the Constitution and should be prosecuted to the full extent of the law,” it said.

It added that the shutdown would further aggravate a dire economic state and threaten workplaces and incomes, resulting in increased hardship for many South Africans.

Speaking to eNCA, BUSA CEO Cas Coovadia questioned the EFF’s motivations for the protest.

“We think it is counter-intuitive to demand a stay away to protest against joblessness, to protest against the problems we are having in energy, to protest against an economy that is not growing… To actually address those crises, we need people at work, we need an economy that grows, we need businesses to operate and grow so that they can employ more people.”

He added that the organisation received no indication from its members that they would close on Monday. However, some may take extra precautions – such as having additional security.

He believes that employed South Africans want to protect their jobs and do not see the shutdown as a positive call.

Moreover, Trade Union Solidarity said that all its members will show up to work on Monday and expects all employers to remain open.

Dr Dirk Hermann, Chief Executive of Solidarity, said that employers have a contractual duty to provide work and cannot send employees on compulsory leave or close their businesses without paying their staff.

It further argued that the country’s economy cannot afford to lose a day, as jobs will be threatened.

Despite the EFF previously engaging with the Taxi industry, South African National Taxi Council (Santaco) Western Cape will not be joining the protest.

“We are not a political organisation and our members come from different political parties in the Western Cape. Therefore, we would not want to align ourselves with a particular political party,”  Mandla Hermanus, Santaco’s Western Cape Chair, told CapeTalk. 

Although the organisation was never approached by the EFF, Hermanus said that the party may have contacted other taxi associations.

The Western Cape expects Monday to be a quiet day, regardless of the shutdown, as many South Africans will take be taking a long weekend due to the public holiday on Tuesday.

Read: Skills gap poses a huge security risk for businesses in South Africa

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