ECS3702
Assignment 2
Semester 2 2025
Due 22 September 2025
, Question 1
Trade Effects of COVID-19 on South Africa
The COVID-19 pandemic exerted profound and multifaceted effects on trade in
developing economies such as South Africa, operating through three principal channels:
depressed global demand, severe supply chain disruptions, and heightened commodity
price volatility.
South Africa’s export performance deteriorated markedly in 2020 as stringent
lockdowns in its major trading partners curtailed global industrial activity. Mineral
exports—particularly platinum and gold, which dominate South Africa’s trade
profile—fell by nearly 20%. Imports simultaneously contracted due to the domestic
recession and a depreciating rand, though demand for essential goods, especially
medical supplies, increased as the health crisis deepened.
Direct trade disruptions stemmed from border closures, port congestion, and logistical
breakdowns. Indirect effects were equally significant: the global recession suppressed
demand for key commodities, while the collapse of tourism eroded South Africa’s
services trade. Although partial recovery began in 2021 with vaccine rollouts and
expansionary fiscal measures in advanced economies, the persistence of supply
bottlenecks and uneven global recovery extended the shock’s consequences well into
2022.
1
Assignment 2
Semester 2 2025
Due 22 September 2025
, Question 1
Trade Effects of COVID-19 on South Africa
The COVID-19 pandemic exerted profound and multifaceted effects on trade in
developing economies such as South Africa, operating through three principal channels:
depressed global demand, severe supply chain disruptions, and heightened commodity
price volatility.
South Africa’s export performance deteriorated markedly in 2020 as stringent
lockdowns in its major trading partners curtailed global industrial activity. Mineral
exports—particularly platinum and gold, which dominate South Africa’s trade
profile—fell by nearly 20%. Imports simultaneously contracted due to the domestic
recession and a depreciating rand, though demand for essential goods, especially
medical supplies, increased as the health crisis deepened.
Direct trade disruptions stemmed from border closures, port congestion, and logistical
breakdowns. Indirect effects were equally significant: the global recession suppressed
demand for key commodities, while the collapse of tourism eroded South Africa’s
services trade. Although partial recovery began in 2021 with vaccine rollouts and
expansionary fiscal measures in advanced economies, the persistence of supply
bottlenecks and uneven global recovery extended the shock’s consequences well into
2022.
1
