By Prof. Emmanuel Nnadozie
The COVID-19 pandemic is a major crisis for Africa. To better understand the economic impact, we need to look at the three dimensions of this pandemic. First, is the impact of the disease itself on individuals, families, communities, nations and regions.
The second is the economic and social impact of the response to the pandemic and the mitigation measures that have been put in place and lives and livelihoods, and third is the challenge of post-COVID-19 recovery and reconstruction.
According to various estimates, the pandemic has caused and will continue to have a severe impact on the economies of African countries. The African Development Bank, AfDB, has estimated a loss of gross domestic product, GDP, of between US$22 billion and US$88 billion.
This is a very serious challenge for the continent, as it has direct impact on economic activity and productive capacity through inflation and debt. So far, we have seen disruptions in trade and value chains and there has been a sharp decline in the prices and exports of primary commodities. As such, this is an opportunity to intensify efforts in diversifying and transforming African economies to bring about more resilience.
There is also a reduction in financial flows in terms of investment and diaspora remittances. Foreign aid and tourism have been hit hard, because of the travel bans and lockdowns put in place by various governments to curb the spread of the Coronavirus.
ACBF has been directly affected by the lockdowns and we find ourselves unable to function at full capacity. This affects our ability to support our member states, our non-state actors, and all the institutions at country, regional and continental levels, where we build the capacity of institutions and provide technical skills that are needed to bring about economic transformation.
To overcome this obstacle, the ACBF has devised innovative ways of doing business. This notwithstanding, the demand for our services remains huge, especially in light of the COVID-19-induced challenges facing African countries and their institutions. Financial resources remain a challenge due to their insufficiency, unpredictability and unsustainability.
We are continuously grateful to our member states and partners for their support and call on them to continue investing in their Foundation. This support is critical now more than ever, as COVID-19 continues to threaten the gains made towards the realisation of Agenda 2063.
*Prof. Nnadozie is the Executive Secretary of African Capacity Building Foundation, ACBF