The Impact of Covid-19 on those at the bottom of the pyramid in Africa

As the wave of Covid-19 shifts from Europe, America and China to Africa, there are a lot of questions on whether Africa is best prepared to deal with the pandemic.  These are definitely unprecedented times, with some calling the pandemic the worst disaster the world has seen since World War II and the great depression in the 1930s.  This may perhaps be a real test of hope and endurance for the more than 2 billion people in Africa.

Growth in Sub-Saharan Africa has been significantly impacted by the ongoing Coronavirus outbreak. It is forecast to fall sharply from 2.4% in 2019 to -5.1% in 2020. This will be the first recession in the region for over 25 years, according to the World Bank.

Africa already faces many challenges such as high rates of poverty and inequality, corruption, weak health systems, climate change challenges, supply chains that are dependent on big economies such as China and limited fiscal reserves.

East Africa was emerging from a raging famine in the last 2 years, with countries such as Sudan and DRC emerging from war and the Ebola Crisis. Other Southern African countries such as Zimbabwe and Malawi were emerging from disastrous flooding and deaths due to cyclone Idai in 2019.

Responding to the crisis, the International Monetary Fund (IMF) announced the immediate write off of legacy debt to 25 countries, 18 countries of which are in Africa. Countries like Malawi and DRC Congo are benefitting from this significant measure.

While this is helpful, the reality is that Covid-19 is a global disaster of unpreceded proportions. As Africa looks to wealthier nations for assistance, most of these nations are consumed with harnessing their resources for their own domestic responses.

At the start of the pandemic, many African governments responded quickly by shutting their borders and grounding airlines.  With most countries having implemented lockdown measures, the impact of Covid-19 will be catastrophic for small business, those in the informal sector and those at the bottom of the pyramid.

Surviving lockdown while going hungry

Though the measures by governments to implement lockdown are necessary, the average person on the streets of Harare in Zimbabwe and Kinshasa in DRC is asking: ‘how can I survive for more than 21 days without food to eat and without basic needs in the household?’.

There are other serious negative consequences from the current Covid-19 shutdown, such as mental health challenges and an increase in gender-based violence.

Unarguably, those that bear the brunt in such times of crisis are women. They are the ones that till the land to feed families, that take on unpaid care work during lockdown while already taking care of the household. At the same time, the girl child is missing her time to read and continue with home learning during this period.

Young girls and boys have had to miss school. With limited internet facilities and technology options for most schools, Africa’s young people are missing out on valuable time to improve their education, prepare and sit for exams and move towards their future.  This will significantly impact on the targets set to address poverty by 2030.

Those in agriculture are counting losses too with challenges in harvesting and linking to markets as demand for goods and services is now low. Non-essential services such as commuters and hotels, restaurants and beer halls are now shut down.

Other analysts have been highlighting that if this crisis continues, there may be pockets of social unrest and increase in criminal activity in parts of cities in Africa as young unemployed people and those in the informal sector look at options for survival.

One of the major challenges if the crisis persists is the loss of employment as companies lay off staff.  This ripple impact of this is huge, as loss of employment will mean loss of income, reduction in aggregate demand and lost livelihoods for households.

This will result in more and more people in Africa descending into abject poverty unless governments put in place safety nets.  Hopes of limited progress towards realisation of the Sustainable development Goals by 2030 could be dashed.

How do we respond to these challenges?

It is important to reflect on what are the lessons and policy actions for governments, particularly in Africa.  Here are 10 reflections based on lessons learnt that are important for how we respond to the challenges of COVID-19 in Africa:

• The critical importance of building robust and well-resourced health systems including infrastructure, medical supply chains and health personnel.  This is critical to ensure that countries are able to respond quickly to major epidemics such as Covid-19 in future.
• The importance of focusing on resilience building for economies at macro level and households at micro level to be able to withstand shocks. African governments need to build fiscal buffers and accommodative monetary policy that will allow them to respond adequately to shocks in future and allow the economies to bounce back after the pandemic.
• The importance of providing safety nets to the poor.  The crisis has shown that those at the bottom of the pyramid are impacted the most and therefore African governments should continue to provide robust safety nets and social protection programmes particularly in crisis.
• There is a need for African countries to stamp out corruption, illicit financial flows and effectively account for budgetary and development support to build resilient economies and ensure inclusive growth.  Also important is to ensure transparency in handling humanitarian aid.
• As the young and old in both formal and informal sectors have been hit hard by the lockdowns across countries, there is an need to develop innovative insurance products that can cushion people from shocks such as layoffs and loss of income.
• Silencing the guns.  The new war should never be about guns but about protecting populations from external shocks such as Covid-19. Therefore the clarion call by African Union to silence guns and stop conflicts across the continent is more urgent now than ever.
• The need to bridge the gender divide, promote women’s empowerment, skills development and employment creation for young people in order to build resilient communities.
• The need to invest in fast, reliable and low-cost internet connectivity and technologies.  As people have been working and young people have been trying to access e-learning platforms from home there has been a surge in demand for internet services.
• Speed up investments in mobile and internet banking solutions.  As handling cash has been linked to the potential spread of Covid-19, there is need for regulators across Africa to accelerate investments in mobile and internet banking solutions.
• Invest in cold chains and agro-processing industries.  With subdued demand, farmers have been witnessing increased post-harvest losses.  There is a need to invest in cold chain facilities and agro-processing industries to be able to deal with subdued demand during times of lock down.

As governments, businesses and communities have been counting the costs of the lockdown across the world, there is no doubt that those at the bottom of the pyramid are the most affected, particularly in Africa.

There is a need for African governments, businesses and partners to rethink inclusive economic growth and addressing inequality while building resilience economies and health systems to withstand shocks in the future.

Dony Mazingaizo is Trócaire’s Country Director for Rwanda

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