Africa, uphill for rich, reset for the poor

To answer the question of how Africa's economic recovery will be after the Covid-19, it may be convenient to make first a review of the few certainties, and th

Africa, uphill for rich, reset for the poor

To answer the question of how Africa's economic recovery will be after the Covid-19, it may be convenient to make first a review of the few certainties, and the enormous doubts that has left and leaves the passage of the pandemic by the continent. While the Coronavirus collapsed the hospitals of the first world, the fragile health system of the poorest countries did not suffer its blow in the same way, nor did all the millions of people have died as experts.

Africa is the continent with less air connections in the world. This explains the delay in the expansion of Coronavirus since February 14, 2020, the date on which the first positive of the virus was found in Egypt. The movement between countries is less than in Europe or Asia and in that influence, for example, the absence of highways and the low number of airlines that cover, for example, sub-Saharan Africa. That is why the cases ascended (and still ascend) more slowly. In addition, most countries have a much younger population than European, with 60% of the total inhabitants below 18 years, that is, the age range that usually passes the virus asymptomatic and less contaging .

Nor do we know the real impact due to lack of tests and laboratories. With a minimum capacity of testing, it is curious that countries that have notified the most cases of Covid are the most wealthy of the continent: South Africa, Nigeria, Egypt, Morocco or Ethiopia. Does that mean that they have more real cases than Cameroon, Somalia or Mauritania? No, but they do have more resources. For many Ministers of Health of the African continent, the Coronavirus is the last of his concerns. With raquitic budgets and sanitary structures often inherited from colonization, Covid is a lesser problem against malaria, anger or measles.

Clarified this point, and knowing that the data is fragmentary and incomplete, we can intuit that the Coronavirus has not impacted as illness in Africa as well as in Western countries, nor in contagions or in mortality. Does that mean that the economic blow has also been less? Let's see it.

It is estimated that economic growth in sub-Saharan Africa contracted by 2.0% in the nefarious 2020, closer to the lower limit of the forecast in April 2020. According to the World Bank, the recovery prospects are being strengthened in the midst of efforts From the countries of the continent to contain new waves of the pandemic and accelerate the arrival of vaccines. One -2% does not seem much given the circumstances, but we will see how that data does not say too much in a continent economic differences not only among countries (many more than Europe, for example), but within the country itself.

The best example is Nigeria. In an oil state where the Ferrari conducted led by millionaires with the poorest citizens of Earth, the country faces the enormous challenge of administering its current demographic bomb: 220 million people and growing among enormous political and religious tensions. At the other end of oil exporting countries, South Sudan, for example, with a similar extension, it has 12 million more inhabitants, at least three who have fled by civil war, that is, a huge expanse of rural land and underdeveloped with irresolvable problems of ethnic violence. The way to face postpandemic recovery will be totally different in both cases. Probably, South Sudan acts as if the virus, a minor evil among all those who affect him, would never have happened. For many African countries, especially the poorest, it is not about recovering their economic development, because they never had something similar, but to promote it for the first time.

Analysts Steven Forsythe and Suneta Sharma write a long essay on the different impact of the pandemic in Africa and the output of the crisis. "It is essential to understand how differences in economic structures can affect the impact of Covid. For example, Cape Verde, the most infected country in Africa per capita, obtains 18% of its Gross Tourism Internal Product, a sector that has been devastated by the pandemic ». Seychelles tourists, which originally had a growth projection for 2020 of 3.3%, ended by 14.4%.

"However, African countries that are large producers of minerals such as gold have suffered much minor impacts, due in part to the increase in the price of raw material," says Forsythe and Sharma.

For the United Nations, "the Coronavirus will drag the main African economies to a fall of around 1.4% in GDP, while smaller economies face a contraction of up to 7.8%". The braking is mainly "to the export adjustments that affect the producers and sellers of primary products and the consequent losses of tax revenues, which reduce the government's capacity to expand the necessary public services to respond to the crisis." That is, that if the poorest governments in the region also enter less, they will respond worse to recovery.

This same summer has been held in Paris, the French Board of Investors in Africa or CIAN, for its acronym in English. The conclusion of Akinwumi Adesina, president of the African Development Bank, was as follows: "Before the start of the pandemic, the six most dynamic economies in the world were African. But after more than a year of sanitary restrictions, countries that depend mainly on oil and tourism have paid a high price. To create wealth, these nations must diversify. There is also the area of free continental trade. To be profitable, this must have a real industrialization of the entire region, so that it is not only an exchange zone but rather a crossing of roads in which there are companies and industries ».

For the United Nations Development Program, "the economic recession of the pandemic will persist in all countries, with reductions in GDP in some areas, since the Coronavirus will remain present in the 2030 and, possibly, in the in 2050 ». On the unequal impact on African countries, the UNDP reports affirm that, "although some countries show a sustained recovery, others will fall into increasing economic recessions. For example, the GDP of Mauritius is expected to decrease at -10.2% in this decade, and this fall will be sustained up to 6.9% in 2050, while Mali, a depleted country, will fall. , 3% in this decade and one -9.2% in the 2050 ».

What solutions can be applied to ensure that the vulnerable African economies return to the path of growth? One of them may be to renegotiate the debt. Mora courties were designed to free resources for health services. However, these attempts generally have not been successful. The International Monetary Fund will inject, for its part, 16,000 million dollars in sub-Saharan Africa, although specialists encrypt recovery needs by 42,000 million, much more than double.

Africa will have to recover the passage in a context of localized but important problems, perhaps more harmful than the pandemic itself, such as corruption, climate change, the expansion of jihadism throughout the sahel, Chinese neocolonialism, the Exodus to the Great cities, overcrowding ...

Perhaps the country that best exemplifies the fight against the Covid and its consequences is South Africa. It was one of the African states most affected by the pandemic (with a fall of 6.1% of GDP by 2020 and 78,694 dead by the disease), has come to suffer its own strain (beta variant) and its expansion condemned millions Of people not to be able to leave their Township despite depending on a subsistence economy.

The finances of the country have frozen time, even before the coronavirus. The industry and gold mining stopped giving benefits and tourism has stopped arriving. For all these reasons, the president of South Africa, Cyril Ramaphaosa, announced before summer his plan to get out of the crisis: his Government will allocate 500,000 million Rands - a 24,500 million euros - a new package of measures to underpin the economy and facing the serious social consequences that the crisis of Coronavirus is producing in the country.

According to Business Times Africa, the program will be financed through the prioritization of about 130,000 million randes of existing and loan budgets, while another 200,000 million will be guarantees so that banks can provide. Another 100 billion Rands will be allocated to the protection of employment and about 50,000 million will be allocated to social assistance. All this money represents around 10% of the national GDP and will be achieved from a new budget, of the Unemployment Insurance Fund and multilateral institutions, including the World Bank, the IMF and the African Development Bank.

The South African President, Mienbro of the African National Congress of Nelson Mandela, will have to address the health and economic emergency if he does not want his streets to burn again.

Updated Date: 21 August 2021, 20:46

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