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Southern Africa Trust |

COVID-19 in Africa Protecting Lives and Economies

African Philanthropy

People: Anywhere between 300,000 and 3.3 million African people could lose their lives as a direct result of COVID-19, depending on the intervention measures taken to stop the spread. Africa is particularly susceptible because 56 per cent of the urban population is concentrated in overcrowded and poorly serviced slum dwellings (excluding North Africa) and only 34 per cent of the households have access to basic hand washing facilities. In all, 71 per cent of Africa’s workforce is informally employed, and most of those cannot work from home. Close to 40 per cent of children under 5 years of age in Africa are undernourished. Of all the continents Africa has the highest prevalence of certain underlying conditions, like tuberculosis and HIV/AIDS. With lower ratios of hospital beds and health professionals to its population than other regions, high dependency on imports for its medicinal and pharmaceutical products, weak legal identity systems for direct benefit transfers, and weak economies that are unable to sustain health and lockdown costs, the continent is vulnerable.

Prosperity: The impact on African economies could be the slowing of growth to 1.8 per cent in the best case scenario or a contraction of 2.6 per cent in the worst case. This has the potential to push 29 million people into extreme poverty. Even if the spread of COVID-19 is suppressed in Africa its economic damage will be unavoidable. The price of oil, which accounts for 40 per cent of Africa’s exports, has halved, and major African exports such as textiles and fresh-cut flowers have crashed. Tourism – which accounts for up to 38 per cent of the gross domestic product (GDP) of some African countries – has effectively halted, as has the airline industry that supports it. Collapsed businesses may never recover. Without a rapid response, Governments risk losing control and facing unrest. To protect and build towards our shared prosperity at least a $100 billion fiscal stimulus is needed to immediately address the urgent healthcare needs, provide safety net for the most vulnerable, protect jobs and support economic activity where possible.

Partnerships: African economies are interconnected: our response must bring us together as one. The development finance institutions must at this time play an unprecedented counter-cyclical role to protect the private sector and save jobs. We must keep trade flowing, particularly in essential medical supplies and staple foods, by fighting the urge to impose export bans. Intellectual property on medical supplies, novel testing kits and vaccines must be shared to help the continent’s private sector take its part in our response. The level of assistance that is required is unprecedented. Innovative financing facilities are needed, including a complete temporary debt standstill, enhanced access to emergency funding facilities, and the provision of liquidity lines to the private sector in Africa. We must “build back better”, by ensuring that there is an abiding climate consciousness in the rebuilding and by leveraging the digital economy. And we must be firm and clear on good governance to safeguard African health systems, ensure proper use of emergency funds, hold African businesses from collapse and reduce worker lay-offs.

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