Will the Simonsberg Fire Losses Impact a Struggling Economy?

Mar 07, 2016
Author: Ean Barnard

The Simonsberg fire, with high temperatures and winds fanning the flames, it took many firefighters, helicopters and volunteers days to stop the inferno. Hot and dry summer conditions often lead to wildfires. Roughly 2 500 hectares of farmland suffered, consisting mainly of pine plantation, fynbos, bush, and vineyards. Whether the fire was caused by natural circumstances or by arson, the losses will be into the millions, with many wine farms suffering the loss of top notch vineyards that took years to grow to produce grapes of such quality.

How do wildfires impact the local economy?

As wildfires are growing in scale and duration, an increasing number of communities are affected, we need a clearer understanding of how wildfires affect economies and communities. Fire impacts are often described in terms of lives threatened, structures and homes lost or damaged, overall suppression costs, and damage to the natural resources on which many rural communities rely.

Fires play a natural and useful role in the life-cycle of a forest and its ecosystem. But fire can also have a devastating long-term effect on ecosystems that are not adapted to such patterns of burning. In this case, especially on vineyards and plantations. Wildfires disrupt the lives of workers, families, and employers. It would be rather difficult to say what the impact would be on the South African economy at large. The local town of Stellenbosch will definitely feel the impact of the losses. Being a cultural and tourism hotspot, thanks to the booming wine industry and many world class wine farms, there are many short and long-term effects that will be noticeable.

Unlike with other natural hazards, there has been little research about how wildfires affect local economies. One can expect effects in the local labour market such as amplified seasonal variation in employment. One might argue that there are even positive effects resulting from fire losses. Resources needed to rebuild and regenerate the farmlands and natural vegetation will profit local business, but prove very costly to farm owners. Wildfires can therefore have positive and negative effects on the local economy. Positive effects come from the economic activity generated in the community during fire suppression and post-fire rebuilding. These may include forestry support work, such as building fire lines and performing other defences. Among other negative economic effects for communities, wildfires can burn timber, make recreation and tourism unappealing, and affect agricultural production.

What can you do?

As a South African citizen, there’s not much you can do against wildfires or other natural disasters, though, you can educate yourself on the local economic effects that are caused by them. Perhaps you can even become a volunteer, aiding the precautions against them.


Fincheck is surely a supporter of the local economy, we hope the broadens your insight on your local economy and the resulting occurrences when disaster strikes. It's all about positioning yourself, some will lose and some will profit!

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