The global response to the COVID-19 pandemic must be coordinated and targeted at livelihoods to prevent an upsurge in inequality, delegates at an African Development Institute (ADI) webinar urged on Wednesday.
“This is an opportunity to re-think macro-economic policy in Africa. We should not go back to our old ways. The sense of urgency that is coming from the crisis must translate into accelerated action on things that will make our continent less dependent on others in times like this. We should aim not only to build back the economy, but to build back better,” the speakers recommended.
The delegates called on African leaders to use the urgency created by the pandemic to accelerate investments in implementing the African Development Bank Group’s Hi 5s, accelerate regional integration and deepen local financial markets to withstand future shocks as envisaged under the African Continental Free Trade Area agreement.
COVID-19 is spreading quickly in Africa and is already straining the continent’s fragile health systems, economies, trade, cultures, societies and livelihoods. Africa’s public and private sectors, individuals and communities are struggling to respond to the pandemic amid commercial lockdowns and disruption of income sources.
It is estimated that Africa will require stimulus worth $110-$150 billion to provide social and economic relief to its economies in the wake of the pandemic.
The webinar, titled Enhancing Resilience in African Economies: Macro-Economic Policy Responses to COVID-19 Pandemic in Africa, sought to address the implications for African economies as many nations scrambled together fiscal stimulus packages to avoid total economic collapse.
The panellists, comprising global leaders, researchers, academics, former finance ministers and central bank governors, explored potential fiscal, monetary and governance reforms that would bolster resilience of African economies.
Key recommendations that emerged include the need for innovative fiscal, monetary and exchange rate policies that focus on saving the livelihoods of citizens, rescuing thriving private investments, including small businesses, to protect jobs, and strengthening regional and national institutions to make them more independent, resilient and effective.
Another key recommendation is the need to strengthen health infrastructure across African countries, invest in STEM to equip countries for the digital economy and to build capacity of member countries to implement existing policies and continental declarations already acceded to by them.
The seminar highlighted the fact that Africa’s youthful population is a big plus for Africa’s ability to withstand the COVID-19 pandemic. The virus is known to have more effects on the aged (over 60 years) and people with underlying health conditions. The delegates called on leaders to consider lock-down policies based on science and evidence relevant to the realities of each country. There is no magic bullet that fits every country’s conditions.
Noting that COVID-19 is a pandemic within many other endemic diseases and external shocks such as malaria, tuberculosis and climate change, the experts recommended the creation of an Africa Group of 30, comprised of finance ministers and Central Bank governors to champion best-case macro-economic policy responses to these persistent problems.
Government and business leaders must improve transparency and accountability to attract more investment inflows and donor assistance for inclusive development, the panelists agreed.
More than 350 participants tuned into the seminar, the first in a series held by the ADI as part of its Global Community of Practice (G-CoP) to facilitate knowledge and policy dialogue to help African countries respond better to the pandemic.
In closing, ADI announced that it is already developing a Public Service Delivery Index (PSDI) to help improve transparency and accountability in public service delivery in Africa, and will soon launch an African Public Finance Management Academy (PFMA) to help countries with prudential public finance management.
The ADI and the lead experts in the African Development Bank Group and globally, will synthesize the recommendations emerging from the seminar in a policy brief to help African countries and other stakeholders respond effectively to COVID-19 going forward, as well as to future crises.
The African Development Institute (ADI) is the African Development Bank’s focal point for Capacity Development. Its goal is to lead efforts at building sustainable capacity for development effectiveness in the Bank’s regional member countries.-Press release