Despite the economic and social progress achieved in the past two decades, growth in most African countries remains characteristically fragile.
This affects the continent’s economic, social, political, and cultural fabric and revolves around political instability; weak institutions that lead to poor accountability and leadership; civil and political unrest; low human development; low investment levels; and low levels of economic diversification.
No one was prepared for Covid-19 and its catastrophic effect on the global economy. It goes without saying that this pandemic was bound to hit African economies hard. Social and economic issues that were already facing grave challenges have now become exponentially more serious, posing a critical threat to the future growth and even survival of African economic systems.
Granted, Covid has severely affected all socio-political spheres of African life, but several sectors have played a significant role in enabling the harmful effect the virus has had on Africa. These include the continent’s fiscal systems, the digital divide, healthcare systems, human capital, and urban infrastructure.
The weaknesses of Africa’s fiscal systems have been amplified. The systems were already under pressure due to constrained taxation bases and policies, and the debt situation. They were already buckling under the weight of global disruptions such as the United States-China tensions; the effect of Brexit on African supply chains and trade processes; and related financial flow difficulties.
The digital divide between Africa and the developed world has never been more evident. As the world is suddenly thrust into a situation where digitally-driven communication and processes are the only option, accessible and reliable internet and affordable data have become essential public services.
Most of Africa, with its poor digital infrastructure, will experience the harshest outcomes of the crisis. However, the good news is that disruptive solutions are sure to emerge. Countries such as Kenya, which has embraced electronic payment systems using e-money, will have an advantage, and could even design new systems to buttress the economy and social protection money transfer programmes.
Even then, such virtual programmes will face the challenge of designing initiatives that take into account the informal systems prevalent in African economies that make it difficult to identify and locate vulnerable groups that need the interventions the most.
Most African countries’ healthcare systems are not equipped to deal with the basic needs of their populations and hardly receive the support and prioritisation they require. The pandemic has exposed the dire state of African healthcare, including lack of basic resources (such as protective wear for medical professionals and safe and suitable medical environments for patients).
Inefficiencies such as lack of adequate laboratory testing ability and capacity have impeded efforts to contain the virus. The Covid-19 crisis has highlighted the pitfalls of failing to invest in skills development and learning infrastructure, both in schools and professional training.
With the pandemic forcing the closure of schools, most African communities have no access to educational materials due to lack of infrastructure, including digitisation. Many professionals who have access to digital tools do not have the skills to effectively work remotely during lockdowns and curfews. Skill shortages have worsened the effects of the virus on the economic and educational sectors.
The coronavirus has turned the spotlight on poor urban infrastructure such as overcrowded and unregulated public transportation systems, as well as weak social welfare systems.
An efficient public transport system is the cornerstone of urban development and expanding cities. Africa is painfully learning that an atomistic, disorganised, and small public transport system is a recipe for chaos, especially during a health crisis.
Granted, the pandemic has had a devastating effect on the fragile African economies, but the outlook does not need to be completely dire. In order to move forward, we need to learn from it and change. Our weaknesses have been starkly outlined.
We need to address them. One such outstanding weakness is African markets’ reliance on imported goods (and services). This was illustrated by the dire shortage of masks and other medical and safety resources in the initial stages of the outbreak.
The pandemic had taught us that it is time to get serious about efforts such as the Intra-African Trade Agreement, which aims to bolster continental trade and development across all sectors, including manufacturing and distribution. The emphasis should be on allowing domestic production capabilities to take root, backed by strong institutional makeup that supports international trade and regional integration.
African decision and policymakers need to use this as a framework to build capacity for sustainability to strengthen socio-economic development across the continent. There is an urgent need for solutions that will move the continent forward, reduce risk, and maximise opportunities in the wake of the Covid-19 crisis.
Africa’s actions in the aftermath of this social and economic crisis will guide the recovery and inclusive growth of the continent. We cannot predict the future, but we can be better prepared for the uncertainties that lie ahead.
Decisive, research-driven, and solution-orientated steps need to be taken to turn adversity into opportunity. While the full effects of the crisis have yet to be seen, African leaders need to start taking action to mitigate the negative impacts and work towards building and strengthening the continent. Africa will rise from this battle, and with the potential to be stronger than ever before.
Njuguna Ndung’u, AERC Executive Director, former Governor, Central Bank of Kenya
This article was first published in a pullout in The EastAfrican on December 5, 2020.