- In Africa COVID-19 has shifted the cultural context almost beyond recognition. Suddenly previous obstacles to change are surmountable as bigger ones are overcome, and an ethos of urgent action becomes the norm.
- Africa’s digital economy has accelerated, particularly with respect to e-commerce, bolstering regional resilience to the health pandemic.
- But ongoing challenges will require more unified action on: new financing models, supply chain, trade, infrastructure and inclusive digital transformation.
There is no shortage of innovation in Africa, yet ambitious attempts at systemic change are often characterized by a steady crawl rather than the high-speed agility seen during the COVID-19 crisis. The immediacy of the existential threat requires a different pace. So while the hardware for change has been building over the past decades, the software – such as political alignment and cultural resolve – has sometimes held things back.
But COVID-19 has shifted the cultural context almost beyond recognition. Suddenly previous obstacles to change are surmountable as bigger ones are overcome, and an ethos of urgent action becomes the norm.
Africa’s challenges as a result of COVID-19 are significant. Indeed, the pandemic has disrupted government revenues, Foreign Direct Investment, Development Assistance, Remittances, Trade, Tourism – let alone the February oil price shock and its aftereffects. There has also been significant impact on small businesses, particularly those involved in the service sectors.
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Already a minor player in global trade terms, African economies are in danger of even further marginalization as a result of macro trends towards deglobalization. The postponement of the implementation of the Africa Continental Free Trade Area (AfCFTA) from July this year to January next year delivers a blow to immediate trade prospects and associated socio-economic benefits.
The silver lining to the crisis has been the fast tracking of Africa’s digital economy, particularly with respect to e-commerce. This, together with a renewed momentum around public-private collaboration, has already bolstered regional resilience to the health pandemic.
Building the hardware for change
My journey with the World Economic Forum began in 2006 presented as an opportunity for the new President of Tanzania to share his leadership vision with regional and global leaders at the World Economic Forum on Africa in Cape Town.
Subsequently, we launched a public-private cooperation initiative to leverage private sector investment to transform food systems and small holder farmers in collaboration with the Forum’s New Vision for Agriculture system initiative. In 2010 the Forum held the Africa meeting in Dar es Salaam, focused on agriculture, which culminated in the launch of a pan-African initiative called Grow Africa at the Africa meeting in 2011, Cape Town.
I joined the Forum shortly thereafter, excited by the prospect of expanding public-private collaborations to accelerate growth and development to address important systemic challenges, beginning with infrastructure.
Almost ten years on we have made significant strides across multiple countries and industries in the region. These include: the World Economic Forum’s Promoting Global Financial Inclusion project; the Accelerating Sustainable Production project; the Tropical Forest Alliance 2020 (TFA 2020); the Grow Africa initiative; the Africa Infrastructure Fellowship Programme; the Global Water Initiative and the 2030 Water Resources Group; and the Internet for All project.
We also strengthened the global community committed to Africa through annual summits held in Ethiopia, Nigeria, Rwanda and South Africa, as well as in Davos.
Since 2017 we have focused on lessons learned in almost 30 countries in sub-Saharan Africa to create tangible action and impact. Public-private cooperation has become a mainstream multisector approach.
As we enter the decade of delivery for the SDGs and look to the forthcoming implementation of the AfCFTA, the ticking time bomb of tens of millions of young Africans hitting the job market every year, the effects of mounting climate change and persistent health security crises are ever present.
How do we meet these challenges as a unified front? How do we restore or establish resilience? How do we use science, technology and innovation to continue to keep our economies and societies going? These are the questions that keep me up at night.
COVID-19 has increased the urgency and imperative for institutionalized multistakeholder solutions and the Forum remains key to building bridges between Africa and the rest of the world.
Building the software for change: 5 pathways
Within the context of the eventual operationalization of the AfCFTA agreement, and with the COVID-19 crisis enduring, here are five pathways to drive economic recovery and build resilience, with tangible initiatives already underway.
1. New financing models for rapid recovery
The COVID-19 pandemic is likely to drive sub-Saharan Africa into its first recession in 25 years, with growth potentially falling as low as negative 5.1% in 2020. In addition, 20 African countries are either at or close to debt distress levels. In the medium term, due to fiscal consolidation in the traditional donor countries, aid budgets are likely to be affected. There is a critical need to explore new sources of financing, innovative private sector–to–private sector solutions, and public-private partnerships to mobilize additional international financing.
2. Unlocking manufacturing to mitigate global supply chain risks
With estimated pharmaceutical imports of up to 90%, the disruptions to global supply chains due to COVID-19 have posed a major security risk. Moreover, sub-Saharan Africa is the largest rice importing region in the world and has been confronted with export bans in major rice suppliers, compounding disruptions to local food supply chains due to movement restrictions. There is renewed emphasis on boosting sustainable local and regional manufacturing capacity with emphasis on shortening supply chains, creating more resilience and strengthening the role of stakeholder capitalism.
Cognisant of the growing importance of sustainability, Co-Chaired by the Ministers for Environment from Rwanda and South Africa, the African Circular Economy Alliance was conceived at the Africa meeting in 2016 in Kigali. In 2020 a formal secretariat was launched based at the African Development Bank.
3. Leveraging integration and regional value chains
AfCFTA has the potential to significantly increase intra-Africa trade, strengthening regional value chains, making it easier to scale up diversification and improve economic resilience, while building capabilities to command a greater share of global value chains. For local small and medium-sized enterprises – which account for about 80% of Africa’s businesses – access to regional markets can strengthen their competitiveness and growth that in turn can alleviate the jobs crisis.
The Global Alliance for Trade Facilitation (GATF) enables goods to be moved across borders more quickly and with less red tape. It does so by implementing trade facilitation projects in emerging markets through public-private cooperation. In Africa, projects have been launched in Ghana, Kenya and Nigeria. Following an addition of 5 projects, by the end of 2020 Africa will be the biggest region for the GATF.
4. Revitalizing infrastructure and connectivity
One of the region’s top developmental challenges continues to be the shortage of physical and social infrastructure. Greater economic activity, enhanced efficiency and increased competitiveness are hampered by inadequate transport, communication and power infrastructure. Moreover, the region’s social infrastructure, including water and sanitation, education and health, is under extreme pressure in the fight against the COVID-19 pandemic. New public-private and private-private collaborations are called for to tap new sources of liquidity to expedite the delivery of green infrastructure.
Equally, the Sustainable Development Investment Partnership seeks to mobilize blended finance and unlock private financing for sustainable projects via its Africa Hub, based in Johannesburg.
5. Scaling up digital transformation and inclusive innovation
COVID-19 has changed the digital innovation landscape in Africa, from healthcare tech solutions and online education platforms, to mobile payment services and online retailing, encouraged by cooperation from regulators and governments.
Additionally, digital innovations have facilitated the analysis of big data relating to citizens' movement, disease transmission patterns and health monitoring to aid prevention measures. Fourth Industrial Revolution technologies, such as the use of drones and artificial intelligence, are playing instrumental roles. Not surprisingly, African entrepreneurs with a digital footprint are embracing COVID-19 as a positive game changer. In 2020, two new affiliate Centres for the Fourth Industrial Revolution are to be established in Rwanda and South Africa.
Collectively, these pathways might create a tide of change that uses the urgency of COVID-19 recovery to permanently lift the fortunes of communities and nations across the continent.
Africa and COVID-19: a model for collective action
Following the 2014 Ebola virus crisis in West Africa, the AU set up an Africa Centers for Disease Control (Africa CDC). The Africa CDC played a significant role in ramping up the readiness of national health systems in the continent as the COVID-19 outbreak started to emerge globally. Apart from setting up regional collaborating hubs, the Africa CDC also strengthened collaboration with the private sector building on initial support from the Jack Ma Foundation when global supply chains for healthcare equipment collapsed.
The Africa CDC set up a Partnership to Accelerate COVID-19 Testing Africa focused on conducting millions of COVID-19 tests, deploying 1 million community healthcare workers for tracing and training 100,000 healthcare workers to support treatment. In June, the Africa Medical Supplies Platform (Africa MSP) and the Africa Communication and Information Platform for Health and Economic Action (Africa CIPHEA) were set up.
The Africa MSP is a pool procurement platform for critical laboratory and medical supplies for African governments with a prioritization for Made in Africa products. Spearheaded by the UN Economic Commission for Africa, the Africa CIPHEA is a collaboration between major mobile network operators in the region, governments and international development organizations that enables evidence-based decision making through sharing of intelligent information and analysis of live data.
The mobilization and cooperation among the AU’s member states is an example to other – so-called ‘more advanced’ – regions and is an indication of Africa’s real potential for transformation.
Where political will aligns and the context urges collective action – the combined outcome is significantly greater than the sum of its respective parts.
This article first appeared on Business Day.