As the whole world is still grappling with the pandemic, the Coronavirus crisis has hit Africa quite hard, with the economic damage and health costs leaving the continent in need of an estimated $1.2 trillion over the next three years, the International Monetary Fund (IMF) projects.
Accordingly, an urgent and comprehensive strategy has become a necessity to not only mitigate and contain the crisis, but also for Africa to recover better and stronger.
This month, Business Today Egypt speaks to the Commissioner for Infrastructure and Energy at the African Union Commission (AUC) Dr. Amani Abou-Zeid on Covid-19’s impact on Africa’s economy, and how the pandemic can be seen as an opportunity for the continent to grow stronger.
What did Covid-19 do to Africa?
“The damage in the African continent went beyond the [pandemic],” Abou-Zeid states, adding that the negative impact incurred due to the virus could reach $1.2 trillion.
“The African continent has seen a hiatus in different aspects of life, including tourism and aviation, which are among the largest sources of income for the continent, with the tourism sector making up 10 percent of its income,” Abou-Zeid says, clarifying that the lockdown that ensued the spread of the Coronavirus has also deeply affected the African continent in various other sectors like transport and electricity.
The commissioner also highlights the halt of the supply chains as imports and exports were paused, which has had a great impact on many African countries, especially those whose incomes rely on exporting raw materials.
Further noting the scale of negative impacts on the African society’s different segments, Abou-Zaid cites that around 60 percent of Africa’s economy “depends on [the] informal sector,” and thus many population segments have been largely affected. She also adds that an important part of Africa’s revenues comes from remittances of African nationals living abroad, which have also been hit hard. Even financial transfers from cities to countryside were affected, Abou-Zeid says.
However, the commissioner notes that the rate of infection and deaths in Africa is still relatively lower than other parts of the world, with number of deaths in the whole Continent almost below cities like New York. “This prompted us, in Africa and around the world, to re-think ways of containing the virus, and at the same time prepare for the recovery phase,” Abou-Zeid says.
Underreported African action and recovery plan
Speaking of continental containment and recovery, the commissioner notes that Africa’s actions during the first weeks of the pandemic were “exemplary”, adding, however, that the excellent steps taken by the continent were underreported by the media.
“There were concerted efforts and solidarity among African countries to deal with the virus, like establishing a fund to help mitigate the negative impact, as well as sending food supplies, medical aids, PPEs and humanitarian teams to countries with shortage within the continent,” Abou-Zeid says.
She notes some examples of countries that sent humanitarian aid, including Egypt, which has sent aid to 30 African countries, whereas Morocco sent aid to 15 countries; and Chinese business magnate, investor Jack Na of China also did send aid to different African states.
Moreover, the African Center for Disease Control (ACDC) has been playing an incredible role in terms of supporting countries to control the virus, as well as developing a platform to pool medical orders, and establishing and purchasing medical supplies with unified prices for all countries, Abou-Zeid notes.
Sectorial ministerial meetings have also been held to discuss the negative impact of the virus and improve the continent’s resilience in controlling it, like in electricity and energy sectors, where many countries “need to shift to a de-centralization approach and to rely more on renewable energy, to feed remote areas within [their] territories,” Abou-Zeid says.
“We are working to help electricity utility companies to restructure themselves, adopt new technologies and resume strongly,” she adds.
Stressing that digitalization is the most important part of the continental recovery plan, with e-learning, e-health, e-commerce, finetech, and a shift to digital transformation in every sector becoming inevitable, the commissioner notes that the ministerial meetings have guided the continental urgent plans, as well as the recovery plans advocating free access to online educational platforms for all students amid the lockdown following the pandemic. Besides, telecommunication operators have stepped in, and expanded access hours for their platforms, while others reduced charge to support populations, the commissioner affirms.
Abou-Zeid also notes that Africa has created a Continental task force to help resume African air transport, “so that our priorities go along the lines with the precautionary measures and standards set by the World Health Organization and the International Civil Aviation Organization (ICAO) to be applied by airlines and at airports.”
Moreover, as most countries have resumed flight movement, the commissioner says that the African Union is working on mobilizing technical and financial support to the African air transport industry, including the small airlines that have witnessed setbacks.
In that light, she highly commends the measures taken by Egypt in support of air transport and tourism sectors among a set of phased measures to open the economy gradually, noting that it has been recognized as one of the best examples in dealing with the global pandemic crisis.
The other face of the crisis
Despite all the negative impacts that have inflicted billions of dollars in losses on the continent, Abou-Zeid still sees that the pandemic has given a great opportunity for Africa to re-rethink and re-engineer all sectors, work and life, noting that lifestyles have changed after the pandemic, with people caring more about healthy habits such as sports, getting more sunlight, strengthening immunity, and washing food thoroughly, etc.
“The opportunity is the other face for a crisis,” Abou-Zeid says, adding that the pandemic has forced many countries and even companies to adopt new business models, and to expedite digital transformation.
African countries that started earlier to incorporate technology into sectors, like Egypt, have higher economic resilience, she says, adding that “it enabled Egypt to manage the crisis very professionally despite the huge economic pressures it encountered.”
The commissioner also mentions the education and health sectors, noting that Egypt has started using tablets at schools, and has equipped and rehabilitated many hospitals.
Moreover, there are some lessons that Africa, as well as the whole world have learned well during this pandemic and its shared experience, the commissioner says, noting that some sectors have been dramatically affected, and will need rethinking by governments to cope with the global developments. For instance, the employment market will never be the same again, and so are the skills needed for work, she explains.
Moreover, the crisis has highlighted the urgent necessity of the Internet, which is no longer a “luxury”, Abou-Zeid stresses.
“Only 39 percent of the continent has internet access, and 60 percent do not have the necessary skills to use it or benefit from its applications,” she says, noting that “e-commerce has increased by 500 percent, and marketing has totally changed, which means that education and even vocational training cannot be similar to that of six months ago.”
Supply chains disruption due to the lockdown has also made clearer to the continent the importance of promoting African industries and intra-African trade, the commissioner notes, adding that The African Continental Free Trade Area (AfCFA) which is expected to be operational in January 2021 provides an excellent opportunity to boost intra- African trade.