Coronavirus Economic Crisis (Pt. 2): Unemployment, Health and Singapore

Coronavirus Economic Crisis (Pt. 2): Unemployment, Health and Singapore

Are we going… YES. Recession is already here. Entire industries have come to a halt, unemployment rates are skyrocketing, countries are enforcing stricter and stricter lockdown laws, and Coronavirus cases are on the rise globally. The question isn’t anymore if we are going into recession, or when we are going into recession, the question to ask now is, how bad will it be? The following article will analyze the U.S. and global economic situation through the lens of unemployment and a coordinated health response, while explaining the unique importance of Singapore.

United States Unemployment Impact

One of the first major weekly indicators showing the overall impact of the Coronavirus has been and will continue to be the rise in unemployment benefit filings. Every Thursday, the Bureau of Labor Statistics in the United States releases the number of individuals who had filed for unemployment in the previous week, and the numbers are rapidly rising. Over the past three weeks, unemployment records have been broken. On March 12^th the BLS reported that approximately 30,000 people in the United States had filed for unemployment. One week later, on March 19^th, this number rose 33% in 7 days to 281,000. 

The previous highest U.S. weekly increase in unemployment filings was approximately 695,000 back in 1982. This was shattered as on March 26^th, as jobless claims exceeded Goldman Sachs and JP Morgan estimates, with the week’s official number being 3.25 million filings. One week later, on April 2^nd, an additional 6.87 million individuals in the U.S. filed for unemployment, and just last week, the pattern continued on April 9th as another 6.61 million individuals filed jobless claims. In just 21 days, the number of people filing for unemployment has skyrocketed from 211,000 to two consecutive weeks above 6 million, which is a 3100% increase weekly, never before seen in U.S. history. The weekly jobless claims trend can be seen in figure 1 above tracing back to 1967, and the chilling spike of the last three weeks seem to statistically mirror the grueling Mt. Everest in the face the U.S. economy’s last fifty-year history. The facts are these, in three weeks 16.8 million people have filed for unemployment, which is 10% of the current U.S. labor force. That brings the estimated overall unemployment rate to around 14.4% but due to lags in the economic data releases as official statistics, the true overall unemployment is unknown.  According to William Rodgers, former chief economist at the U.S. Department of Labor, the U.S. unemployment rate has risen from 3.5% to 17% in just three weeks. The exact figure will be unknown for a while, but the reality is this: The U.S. economy has surpassed the level of unemployment experienced at the peak of the Great Recession in less than 21 days. This is completely unprecedented. The unemployment at the height of the Great Recession was 10% in October 2009, and this took 18 – 24 months to develop.

It is important to put these numbers in perspective to truly understand the scope and desolation embedded within these numbers. Imagine in week one, every single teacher in the entire country loses their job in both public and private schools. In week two, every single person involved in any type of transport industry is laid off. No trains, no subways, no planes, no ferries, no buses, no transportation. Now you have a situation where you have no teachers in any schools and no transportation workers. To top it off in week 3, every financial institution shuts down and lays off every single worker. Local, state, and national banks countrywide close, brokers, credit agencies, investment companies, securities contractors, insurance providers, and wealth management firms all closed, everybody is told to go home. Imagine your daily life in this world where you have no teachers, no transportation, and no finances services. This is what has happened in the last 21 days. There are approximately 3.5 million teachers in America in public and private schools, the transportation industry employs around 5.2 million individuals and the financial services, and insurance industries employs approximately 6.5 million people, all totaling around 15.5 million jobs. This is still under the number of jobless claims experienced in the last three weeks, which was approximately 16.8 million jobs.  If you want to paint this picture from a global perspective, envision the entire Australian and New Zealand workforce being laid off in just 21 days, 15.6 million people without a job, and two economies decimated.

Now, what are the longer unemployment projections for possibly the next three months and onward? In a worst-case scenario, in just the next three months, the U.S. federal reserve of St. Louis has forecasted that just the second quarter (April – June) will see 47 million layoffs. This translates to an unemployment rate of 32.1% by the end of June. During the Great Depression, unemployment peaked at 24.9% in 1933, more than three years after the original stock market crash in October of 1929. Expert forecasting suggests that: the U.S. economy will far surpass the Great Depression levels of unemployment and reach a standing rate of 32.1% in just three months. The St. Louis Fed has explicitly said that "These are very large numbers by historical standards, but this is a rather unique shock that is unlike any other experienced by the U.S. economy in the last 100 years.” These are unprecedented and frightening times, as uncertainty seems to be prevailing, but a full – rounded and full informed scope is important to remember.

Crucially these estimates did not account for the impact of the $2 trillion stimulus package recently released by the U.S. government or any future packages they may release. This means that while the stimulus package released by the United States will slightly reduce the impact of the unemployment rate and the negative impact on the economy, but it is not a magic solution. To evaluate its potential effectiveness would take another five pages. Still, I do intend in the next few weeks to analyze the U.S. stimulus package or hopefully packages, in tandem with the actions taken by other governments. But the important thing to understand at this moment in time is that it will have a positive impact, but the stimulus package will not be a cure. For companies and individuals suffering, the stimulus is designed to keep them afloat during this time of crisis until recovery starts. Acting as a bridge while they receive no income or investment. Similar to a lifeboat designed to keep you alive until you reach land or are rescued.

Global Unemployment Impact

Globally there has also been a massive impact on unemployment, “currently, more than 4 out of 5 people (81%) in the global workforce of 3.3 billion are affected by full or partial workplace closures because of COVID-19” according to the International Labor Organization. The report estimated that internationally there are 1.25 billion currently employed individuals working in sectors identified as being at high risk of “drastic and devastating” increases in layoffs and reductions in wages and working hours.[1]

Australian Treasurer Josh Frydenberg said more than 800,000 businesses have already applied for the so-called job keeper program, a program part of Australia’s stimulus packages aiding small businesses. “There’s definitely going to be an uptick in unemployment and a significant reduction in growth,” according to Frydenberg, with experts believing that unemployment could grow to 10.1%.[2] The United Kingdom, according to Oxford University, on par with the United States face the expected probability of reaching a 30% unemployment rate.[3]

In Spain, in March 833,979 lost their jobs, a record number in terms of jobless claims for the country, accounting approximately for 3.5% of the Spanish labor force in just four weeks. This is on top of their already record-high 14% unemployment rate, which is among the highest in the developed world.[4] Austria’s unemployment rate has jumped to 12%, the highest since the aftermath of World War 2. IN Germany, 470,000 companies applied for wage support in March, suggesting that a near 5^th of the German workforce will experience reduced hours.[5]

Across the other side of the world in Asia, Thailand has seen 23 million people (one – third) of its workforce, apply for government cash handouts, the program is expected only to be able to cover 9 million. In China, despite statistics releasing an unemployment number of 6.4%, raging debates have erupted on the credibility and accuracy of these numbers.[6] According to Liu Chenjie, chief economist at fund manager Upright Asset, a privet asset management firm in Hong Kong, 205 million workers have been driven into "frictional unemployment," where individuals want to work but cannot or are unable to return to work. If this were true, this would represent more than 25% of China's 775 million-strong labor force. Based on Lieu’s calculation, the Chinese services sector has been hit the hardest with 180 million jobs disappearing, mainly because of “consumers’ willingness and ability to spend.”, which has been sharply curtailed by the pandemic.[7]

From these numbers, it seems that the United States and China have been the hardest hit, but it is evident that the impacts are being felt throughout global economies. Worse times are most likely still to come as the pandemic is still in its early stages, but it is essential to ask and understand, what does the current situation mean for the long term and the recovery? When will we reach land, or be rescued and start to see a restoration of the U.S. and global economy? This heavily ways on the health response. [8]

Importance of the Health Response

The reality of the matter is that the world is facing a global health crisis, which is causing an economic crisis. It is because of this reality that it is crucial to understand that to reduce the long term economic and health consequences of the COVID – 19 pandemic, a fully enabled global public health response is needed to reduce the severity of the long term financial impact. While this does not mean that in the short term, we won't experience suffering or pain across various global industries, it does mean that if the appropriate and severe short term action falls short of what is desperately needed, the extended consequences could be worse than ever imagined.What do I mean by this? It is the health response that matters for us to get out the other side of this pandemic, financially and medically. According to a new study by world-class doctors and researchers at the University of Sydney, in Sydney Australia, eighty to ninety percent of the country's population needs to strictly follow and practice social distancing.  If only seventy percent of the population follows the social distancing policies, as seen in figure 2, the curve will not flatten. Infection rates will still spike, and the virus will still keeping running rampant. Furthermore, if these policies are followed, the modeling says that the virus infections can be brought under control within a minimum of three to four months.

While this model has been specifically modeled on the Australian population using approximately 24 million software agents, let us see how this model and its predictions compare to what we have seen so far from around the world.

Epicenter: Wuhan, China: The original epicenter of the outbreak, experienced its first cases in December 2019, before identifying the outbreak and going into lockdown quarantine on January 23^rd. Having a history of social control over its citizens, China enforced its strictest policies on the citizens of Wuhan. “Apartment compounds allowed people to go in and out through one gate, each household could only send one person out once every three days to purchase groceries, and everyone's temperature is checked upon entrance.” But despite these substantial measures, numbers continued to rise, and therefore the government increased its restrictive policies. “Hubei government ordered community officials to began enforcing "the strictest, around-the-clock, closed management" of all residential complexes, banning the private use of cars, forbidding residents from leaving their apartments without permission and requiring purchasers of cold medicine to disclose their temperature, address and identification number at the pharmacy.”[9] After 77 days or 11 weeks of complete lockdown, Chinese officials lifted partial restrictions in Wuhan on April 8^th, allowing Wuhan residents to travel domestically and open some businesses. Small businesses and factories in Wuhan started opening last Thursday, March 30^th, ten weeks after the shutdown. While its infection rate has reportedly dropped to near zero, only partial restrictions have been lifted as Chinese officials stay vigilant.[10]

Interesting Mention: South Korea: South Korea and the United States reported their first case on the same day, the stark difference, South Korea was ready, the U.S. wasn't. South Korea had a battle with Middle East Respiratory Syndrome (MERS) back in 2015, which led to mass testing, tracing, and quarantining of 17,000 people, which led to the country squashing the disease in 2 months. Still, MERS only infects one additional person; therefore, its infection rate is much lower than the Coronavirus. After MERS, the government very quickly realized testing alongside hospital prevention and control measures were extremely vital in responding to pandemics. Legislation was also passed promptly in the MERS aftermath strengthening the country’s ability to respond, such as authority given to the government to collect mobile phone, credit card, and other data from those who test positive to reconstruct their recent whereabouts. As a result of these changes, South Korea is very uniquely equipped and ready for the Coronavirus having widely available testing, prevention protocols, quarantine actions, and accurate tracing methods. These measures have enabled them to implement a swift and effective response resulting in only ten thousand cases and 186 deaths and sending the country only into partial lockdown closing schools, religious gatherings, outdoor rallies, daycare centers, and some businesses.[11]

Case to watch: Singapore. Singapore reported its first case on January 24^th, 2020, one day before Australia and immediately took action. Similar to South Korea, Singapore learned many lessons from a previous pandemic, in their case, the SARS outbreak in 2002 and 2003. Within three days of its first case, Singapore had implemented thermal scanning of people arriving at Changi International Airport, and on February 1^st barred all visitors who had visited China in the past 14 days. Just 16 days later, Singapore had 75 confirmed cases and issued a “stay at home” notice, which they track on citizen’s phones. Every few hours, citizens will receive an SMS and are required to click on a link revealing their location, the government even had people knocking on doors routinely preventing people from "gaming" the system and having a friend or family click the link from home if they leave. Like South Korea, Singapore had in place protocols, wide testing availability and were well prepared for COVID – 19, they currently only have six deaths and 1400 cases and have been praised for their initial response by the World Health Organization.

          Here is the interesting part about Singapore. Friday, April 3^rd, prime minister Lee Hsien long announced new stricter lockdowns lasting until May 7^th, closing schools for the first time and most non-essential businesses including gyms, museums, and workplaces while grocery stores, clinics, and banking services will stay open. Lee stated that “Looking at the trend, I am worried that unless we take further steps, things will gradually get worse or another big cluster may push things over the edge.” This has all been done in fear of a second wave, making Singapore as a country and a case study a very imminent leading indicator for the course that COVID – 19 takes in other countries.[12] If a country such as Singapore, whose initial response was among the best if not the best in the world can prevent a second wave with its preventive measures, this is excellent news for the rest of the world. It means that COVID -19 can be managed effectively once brought under control, but if a second wave breaks out, this could potentially be indicating even bigger disaster for the rest of the world. The last devastating global pandemic was the Spanish flu back in 1918, which, although was born in a time under very different circumstances, arrived in three different waves as the virus mutated, killing between twenty and fifty million people globally. Therefore, if Singapore experiences a second wave, this would mean that even if countries currently facing war like numbers such as Italy, Spain, the United States, and the United Kingdom, were to bring COVID – 19 under control in the following months, they could still be potentially vulnerable to a second or third wave, threatening to bring even more devastation.[13]

From a health perspective, the lesson is this, citizens and nations need to abide by strict social distancing laws for a minimum of three months and then reassess the situation before lifting restrictions. If these precautions are not taken and enforced, the devastation we have already seen in terms of infection and mortality rates will exponentially grow, spiraling the virus even further out of control. This will require more extended shutdown periods to contain the virus, meaning that instead of having a painful 3 to 4 months of total lockdown, opening the economy to early could completely reset the clock and erase the progress already made. Ultimately this could result in a six to twelve or in a worst-case scenario eighteen-month ongoing battle with the virus with constant opening and closing of the economy. This type of situation will result in health and economic devastation not only never experienced before in modern history but well beyond our wildest imagination. If this becomes a reality, the COVID – 19 recession will be much worse than the Great Depression, and generations will feel the effects for years to come. Moving forward, what do we do, and what do we look for to avoid devastation?

Takeaways for the Future:

Enforcing social distancing and lockdown laws, it's a crucial step in fighting COVID – 19 and reducing the medical and economic impacts. In terms of unemployment, the next three to five months will see significant increases in numbers in the U.S. and globally, but dependent on the health response, those numbers will hopefully slowly start to stabilize. For a best-case scenario, watch the development of Singapore. If Singapore fails, countries facing a crisis such as the U.S. and Italy, currently in their "first wave," need to be extremely vigilant and could see a fierce battle in the next twelve to eighteen months. As second and third waves could possibly be highly threatening, not only to unemployment and economic figures but to the survival rates of the globe’s 7.7 billion individuals. If Singapore can control and contain what fears to be a possible second wave of the virus in the next two to three months, this will be an incredibly positive sign for the rest of the world. This will mean that future waves can be averted, and the virus can be controlled in three to five months if the appropriate measures are enforced and followed.

Finishing on a positive note, it is understood that we are facing exceptionally challenging times as individuals, families, friends, countries, and economies. It is important to remember that the world has incredible doctors, brave nurses, intelligent researchers, courageous leaders, and, most importantly, strong and resilient individuals. I believe that we can, and we will make it to brighter days. The power of humanity and our ability to stand strong in the face of adversity, which has been underestimated many times before, will win. While we might not always see the light ahead, we will come together, fight together, and emerge on the other side of this global challenge united and stronger than ever before. 

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[1] (HRM Asia, 2020)

[2] (Bloomberg, 2020)

[3] (Bloomberg, 2020)

[4] (The Local Es, 2020)

[5] (Japan Times, 2020)

[6] (Japan Times, 2020)

[7] (South Morning China Post, 2020)

[8] (St. Louis Federal Reserve, 2020)

[9] (NPR, 2020)

[10] (Bloomberg, 2020)

[11] (Science Magazine, 2020)

[12] (ABC News, 2020)

[13] (Forbes, 2020)

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Pedal – Driven Development: How Qhubeka Bicycle Programmes, Are Changing Lives

According to the World Bank Local Economic Development is defined as: “Building up the economic capacity of a local area to improve its economic future and quality of life for all. It is a process by which public, businesses and nongovernmental sector partners work collectively to create better conditions for economic growth and employment generation.” A South African  NGO, Qhubeka truly personifies this understanding of LED, fully capturing the practical value of simple methodologies which successfully generate significant economic and social benefits for all.

Qhubeka is a South African non-profit organization, founded in 2005, which economically empowers local communities through its provision of bicycles. By connecting people to schools, clinics, jobs and exclusive opportunities, Qhubeka, a Nguni word meaning “to progress or move forward”, uses bicycles to change lives. Qhubeka is  expanding throughout most of South Africa, targeting each and every province, implementing programmes ranging from Cape Town in the Western Cape, along the coast to Port Elizabeth in the Eastern Cape, all the way up to  communities in Gauteng, Mpumalanga, North West, Kwa-Zula Natal and Limpopo. According to Qhubeka’s  national programmes manager, Jan Rossouw, Qhubeka’s aim is to “ mobilize people on bicycles,” while simultaneously implementing various programmes and projects, creating substantial economic, safety and educational benefits for struggling communities. Based on the following analysis and insights, in alignment with their current status and through further growth, the future potential impact of Qhubeka’s operations and development initiatives, are enormous.

QHUBEKA PROGRAMMES:

Qhubeka firmly believes that, “good development happens when a community is given a hand – up, not a hand out.” All of the organization’s programmes are based upon a learn – to – earn or work – to – earn programmes, such as the following:

Scholar Mobility Programmes:

The “Scholar Mobility Programme” (SMP)  is designed to empower schools with a mechanism to improve scholar engagement and to drive specific strategic objectives of the school to continuously improve its ability and quality as a learning institution. It further enable scholars access to structured learning institutions and other school and related activities by using bicycles to overcome any mobility constraints. The objective is to ultimately have improved educational outcomes and higher pass rates by increased school attendance, punctuality to school and participation in other school and educational activities.

Linked closely with the Scholar Mobility Programme is Qhubeka’s initiatives to create a safer environment for learners to facilitate improved education outcomes. This is achieved by empowering appointed School Security Personnel and active Community Policing Forum (CPF) members to use bicycles to improve scholar and school safety and security by patrolling and monitoring of school premises, assisting and monitoring school access points, and assisting and escorting learners to school where possible. An added benefit is the general improvement of CPF mobility and visibility around the communities in which the schools are located.

Security Programmes:

Qhubeka is also actively establishing programmes and distributing  bicycles in aim of increasing local security which is a particularly important aspect given South Africa’s extremely high crime rates. A study conducted in India at the University of Delhi using data ranging from 1991 to 2011 found that higher crime rates lead to a lower GDP per capita. In one such example, Qhubeka has recently worked with the Nelson Mandela Bay Municipality  to launch a programme in Port Elizabeth  which bicycles were distributed  and used to train and employ 100 local community members between the age of 18 and 35 to provide sustainable safety and security related services. In partnership with Nelson Mandela Bay Municipality (NMBM) and Volkswagen South Africa (VWSA), they have used the city’s hosting of the Ironman World Championship to  create opportunities for unemployed young adults to earn a decent monthly living wage. Under the programme  employment for 50  “peace officers”, 30 “beach officers” and 20 “tourisim ambassadors” were created, enabling them to, “play a vital role in the sustainable safety and security apparatus of the municipality before, during and after  the event.” According to Qhubeka executive director Tsatsi Phaweni, “the long term hope is to create a legacy programme that can be incorporated into existing neighborhood watches, thus creating a sense of security in communities and the general public.” An effective side note on this particular project is that it aligns with the World Bank’s 2030 Vision and their new “Cascade” approach. A methodology involving development investment strategy which prioritizes public – private partnerships in aim of, ““crowding in” the private sector and “creating markets””.

Healthcare Worker Programmes:

Qhubeka provides bicycles to health workers allowing them to travel further distances to treat patients and carry more medical supplies, enabling communities to receive wider access to healthcare and clinics. This is in turn allows for a healthier individuals and overall population. A study by economists at the Harvard school of Public health in 2004 found that, “health has a positive and statistically significant effect on economic growth.” While another study published in the journal of Applied Economics states that, “health care expenditure must have positive effects on labour productivity, as higher curative and preventive health care expenditures improve labour participation in production activity.” Despite Qhubeka’s bikes not being directly classified as health expenditure, they are directly related to and have vital impact on health services and thus contribute to health expenditure. Furthermore, in 2007 from economist Jocelyn Finlay, also from the Harvard school of public health, mentions the incentive effect, which borne out of theoretical literature, states, “individuals who are healthier and have a greater life expectancy will have the incentive to invest in education as the time horizon over which returns can be earned is extended. Education is the driver of economic growth, and thus health plays an indirect role.” Therefore, it is evident that numerous studies have been conducted and confirm that increased healthcare, access to health services and health expenditure have a significantly positive effect on economic growth, and Qhubeka is playing their part.

Adult Programmes:

Within the adult programmes Qhubeka has various work to earn programmes including the  Tree – prenuer and the Waste – preneur. In return for collecting waste and planting trees, individuals can receive bicycles. A Tree – prenuer is required to plant at least 200 trees and nurture them to the height of 30cm, while a Waste – prenuer can trade 4,000 PET litre bottles or 200kg of sorted waste for a bicycle. Environmental sustainability is under particular threat in many South African rural areas on account of large mining operations which destroy large proportions of natural habitats, thus this type of programming is essential in restoring these territories. Research presented at 5th Ministerial Conference on Environment and Development in Asia, and the Pacific in Seoul, Korea by the three Economic, Environmental and Development experts in Asia found strong relationships between environmental sustainability and economic growth. Their studies showed that economic growth degrades environmental sustainability in most countries, and therefore it is important to ensure that environmental sustainability is in alignment with economic growth, as it allows for an all rounded form of development for local communities. In addition to these programmes, Qhubeka also runs a Bicycle Field Mechanic Program in alignment with  its various programmes which  select members of communities to train in bicycle mechanic skills to ultimately establish a Bicycle repair shop and provides them with technical manuals,  small business skills training courses and bicycle repair tools. This is another vital form of economic development as businesses and employment opportunities assist in creating micro – enterprises which ultimately inject money into local economies, while allowing local citizens to increase their incomes and lift their standard of living.

IMPACT EVALUATION:

As follows is an analysis highlighting key data points truly conveying the groundbreaking impact which Qhubeka is having:

·          Scholar Mobility Programme:

o   Was originally launched in 2009, and in December 2012 and impact study was conducted on 600 households and 300 students assessing the programme outcomes over the previous years. The introduction of Qhubeka seemed to have significant impact as follows:

o   School Attendance:

§  Before bicycle introduction, 21% of parents reported the primary reason for student’s absence to school being DISTANCE, afterwards, this number fell to 0%

§  On average attendance for girls improved by 28% while attendance for boys improved by 25%.

o   Academic performance

§  Amongst the bicycle receivers between boys of girls, as measured by end of term average scores, there was an incredible 22 percentage point and 59% improvement in student results. In three years this is truly outstanding.

o   Travel time

§  Before the bicycle programme was implemented 33% of students travelled to school in one hour or less, 3 years later 89% of students travelled in an hour or less.

o   Quality of life

§  After being surveyed on wellbeing, 73% of students said their lives were significantly improved while 17% reported noticeable change.

o   Safety

§  After bicycles, 69% of students reported feeling safe when going to and from school as most usually face dangers including wild animals, night walks and crime.

Qhubeka tells the story of Percy, “Percy lives in a village in rural Limpopo where there is no high school. He received a bicycle in 2014, when he was in grade 9, through a Qhubeka programme run by World Vision, to help him ride the 5km to the high school in a neighboring town. In January 2018, Percy got his Matric (12^th grade) results – he was one of the four top-performing students in the Limpopo province. He is currently studying to become a medical doctor at the University of the Witwatersrand in Johannesburg.” The economic and social benefits this not only brings to Percy and his family but to the people within his community. He now will be able to get a tertiary education, get a job as a doctor, and increase the standard of living for his family, while injecting money into his local community, and providing local healthcare.

In discussion with national programmes manger Jan Rossouw, he explained the impact on waste pickers. While still tracking the  full impact, they reported that the average waste pickers in Soweto earns about US$100 – US$150 per month. On any given day they may spend 10 hours of their day collecting rubbish, and then sorting through it the following day. Impact reports  indicates that with bicycles waste – preneurs can collect the same amount of rubbish in 5 hours versus the 10 they would take on foot. The ripple impact of this could be astronomical, cutting their collect time in half they could essentially earn nearly double what they normally earn per month, allowing them not only to increase their standard of living and inject more money into their local economy but aid them in escaping poverty.

One of the most incredible stories related to Qhubeka bicycles is that of a father rand son in the midst of tragedy. In 2017, Knysna, South Africa experienced one of the country’s worst bushfires in its history in which a rampant fire, fueled by 90km/hour winds, stretching across 300km, burnt for nearly two weeks. Over a 1000 homes were destroyed, 300 structures were damaged, more than 10,000 people displaced and there was over US$300million in overall damages. Amongst the heartbreak and disaster came a glimpse of hope driven by opportunity. According to national programmes  manager Jan Rossouw, a father and son from a local township in the surrounding Knysna area has been  selling sandwiches to the business and workers in the central business area.  Together they would make sandwiches at their home and walk from the township to the central business district , sell their sandwiches and then walk back to make more. The two became well – known among the businesses  and one day someone pointed out the difference a bicycle could make. Qhubeka provided the father and son with bicycles, and it was like a spark to flame. The duo continued their business and within six months they hired a third worker and within a year the two had bought a car to expand their operations. This extraordinary feat was all made possible by the introduction, of a bicycle. Developing from a situation in where the father and son had to walk many kilometers commuting from a township, the provision of a bicycle allowed them to excel exponentially and purchase a motor vehicle which takes substantial financial capabilities. As best said by Singapore’s former prime minister Lee Kuan Yew, “All people want is an opportunity to better themselves, and we gave them that opportunity.”

In the 2016 and 2017 alone, Qhubeka distributed 14,300 bikes which included over 8,000 to students and 5,000 to work to earn programmes providing economic opportunity. What does this mean for Qhubeka and their economic development impact?  Well, in 2018 they will be aiming to increase distribution to 12,000 – 15,000 bikes and moving forward they have set their goals at 20,000 annually by the end of 2019 and 100,000 per year by 2030. If they are having the impact now, on people like Percy and fathers and sons, there must be many more just like them in the 12,000 – 15,000 bicycles Qhubeka will be distributing by the end of this year, never mind the 100,000 bicycles they are aiming to  to distribute per year by 2030, and the 83,000 bicycles distributed since 2005. Another objective of Qhubeka is to partner with reputable institutions to establish advanced monitoring and evaluation systems which could through the introduction of continual quantifiable outcomes, enable the visualization of their substantial economic impact. Regardless, Qhubeka’s scholar mobility programmes, work to earn programmes, government and business partnerships and various methodologies has allowed their implementation of local economic development to be truly remarkable. As they continue operate, implement and grow moving forward, they could spark a global movement in which the world’s eyes are opened to how bicycles, truly can change lives.