This archive report was first published on 22 May 2020.
As the Covid-19 pandemic continues to spread globally, Africa is beginning to feel the full force of its impact. The mass production shut-downs and supply chain disruptions caused by port closures in China are having a ripple effect across all economic sectors in Africa, resulting in a significant slowdown in economic growth.
According to Dr. Abdiqani Sheikh Omar, a Senior WASH Strategic Policy Advisor at the Ministry of Energy and Water in Somalia and Former Director General at Ministry of Women and Human Rights, the pandemic will have far-reaching implications for Africa's economies. 'I am hopeful the rebound from Covid-19 will coincide with the implementation of the African Continental Free Trade Area (AfCFTA) in July 2020,' he said.
As applied in other continents, some African nations have applied lockdowns, which have brought economic activity to a halt in many African countries. In cushioning the virus impact on the economy, various Central Banks have employed measures to derail the pandemic burden.
For Africa's economies, the implications of these challenges are severe. A slowdown in overall economic growth is already being felt, and this is acute in hard-hit sectors such as tourism. Many businesses, particularly SMEs, are under significant cost pressure and face potential closure and bankruptcy, leading to widespread job losses.
The pandemic will also impact productivity across many sectors. Closure of schools and universities could create longer-term human capital issues for African economies and could disproportionately affect girls, many of whom may not return to school.
African governments might face rising deficits and increased pressure on currencies. In the absence of significant fiscal stimulus packages, the combined impact of these economic, fiscal, and monetary challenges could greatly reduce Africa's GDP growth in 2020.
It is imperative that policymakers act swiftly and boldly by implementing historically large rescue programs with policies structured with a view toward sustainability. Swift, large and sustainable is what our present moment demands.
