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The impact of the COVID-19 enforced lockdown and fiscal package on the South African economy and environment: a preliminary analysis

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  • Chitiga-Mabugu, Margaret
  • Henseler, Martin
  • Mabugu, Ramos
  • Maisonnave, Helene

Abstract

This paper offers a quantitative assessment of the impacts of the COVID-19 pandemic-induced lockdown and government fiscal plan, containing ‘green’ elements on the economy and the environment of South Africa. The analysis uses a dynamic computable general equilibrium model operationalised using a social accounting matrix coupled with a greenhouse gas balance and emissions data. We find that while the economy is harshly impacted by the pandemic in the short term, the government fiscal package ameliorates and cushions the negative effects on poor households. Importantly, an adaptation of the fiscal package towards a ‘greener’ policy achieves the same economic outcome and reduces unemployment. Carbon dioxide emissions decrease in the short run due to economic slowdown. This improvement persists until 2030. These results can be used as decision support for policy makers on how to orient the post COVID-19 policies to be pro-poor and pro-environment, and thus, ‘build back better and fairer’.

Suggested Citation

  • Chitiga-Mabugu, Margaret & Henseler, Martin & Mabugu, Ramos & Maisonnave, Helene, 2022. "The impact of the COVID-19 enforced lockdown and fiscal package on the South African economy and environment: a preliminary analysis," Environment and Development Economics, Cambridge University Press, vol. 27(3), pages 209-222, June.
  • Handle: RePEc:cup:endeec:v:27:y:2022:i:3:p:209-222_1
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    Cited by:

    1. Margaret Chitiga & Martin Henseler & Ramos Emmanuel Mabugu & Hélène Maisonnave, 2022. "How COVID-19 Pandemic Worsens the Economic Situation of Women in South Africa," The European Journal of Development Research, Palgrave Macmillan;European Association of Development Research and Training Institutes (EADI), vol. 34(3), pages 1627-1644, June.
    2. Boureima Sawadogo, 2022. "Drought Impacts on the Crop Sector and Adaptation Options in Burkina Faso: A Gender-Focused Computable General Equilibrium Analysis," Sustainability, MDPI, vol. 14(23), pages 1-22, November.

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