The unrest that sprang up in KwaZulu-Natal in the wake of former president Jacob Zuma’s imprisonment and quickly morphed into rampant looting and destruction of property across vast swathes of the country will have economy-wide implications that will start to become apparent in the coming weeks.
At the time of writing, the Port of Durban as well as long stretches of the N3 toll route between eThekwini and Johannesburg remained shut. SA Petroleum Refineries (Sapref), which accounts for about 35% of SA’s fuel needs, had also ceased operations. Meanwhile, across the greater eThekwini metropole and along the N3 corridor all the way to Pietermartizburg, dozens of shops, factories and warehouses stood damaged or looted.
It’s hard not to overestimate the scale of the damage to SA’s fragile economy. Durban’s container terminal alone handles more than 60% of all container traffic channelled through SA’s ports. That makes the port city critically important to the economy of greater Gauteng, a province that accounts for more than a third of SA’s GDP. Botswana, Zimbabwe and even Zambia and Malawi all rely on Durban’s port facilities for trade, to some extent.
The Road Freight Association (RFA) says the shutting off of Durban and the N3 trade route effectively mean the gateway to Africa has been closed. PwC says the effect on supply chains puts at least 50,000 jobs at risk.
But the true effect will be social. With farmers unable to deliver produce to markets the resulting shortages will stoke food inflation, a factor often cited by economists as a catalyst for social upheaval. The vicious cycle that could be unleashed may soon see SA facing a rather frightening dystopian future, not unlike its very own version of the Hunger Games.
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