At the end of 2019, sub-Saharan Africa’s prospects for the year and decade ahead were exceptionally bright. While economic growth was moderating in other regions, the International Monetary Fund expected sub-Saharan Africa’s growth to accelerate to 3.6 percent in 2020 and 4.2 percent by 2024.
But the Covid-19 pandemic quickly upended those projections—the regional economy is now expected to slip into its first recession in 25 years, with the World Bank forecasting that the economy will contract by between 2.1 and 5.1 percent this year.
Like the rest of the world, Africa faces a daunting period of uncertainty. While Covid-19 is primarily a healthcare crisis, the continent is bracing for widespread job losses as the pandemic takes its toll on the economy, hurting small businesses in particular. Unlike the U.S., many African governments have little firepower for stimulus measures that support healthcare systems, jobs and livelihoods.
Through this wide-angle lens, Africa’s short- and medium-term outlook has clouded significantly.
However, the continent holds a number of advantages over other regions in the fight against Covid-19.
For one, African governments were quicker than most to close their borders and announce life-saving national lockdowns. State leaders have recognized the importance of decisive action, having learned from other countries that are further ahead on the pandemic curve.
South Africa’s President, Cyril Ramaphosa, announced a strict nationwide lockdown on March 23, when there were only 402 cases in the country. The lockdown, now extended, has helped to slow the spread of the virus and has forced citizens to take it more seriously.
Most African countries have taken a similar approach, including Nigeria, which is Africa’s most populous nation, and Kenya, the largest economy in East Africa. Lockdowns have generally been extended, although some states, including Ghana, have already lifted theirs in an effort to minimize economic fallout, saying they have adequately prepared their healthcare systems for the anticipated rise in cases.
Lockdowns and social-distancing measures have bought African countries more time to prepare their health and economic responses to the pandemic. National budgets are being revised and governments are in talks with lenders to restructure debts and free up additional funding.
Meanwhile, many African health authorities are already well-versed in dealing with infectious diseases. The Ebola outbreak that swept through West Africa in 2014 has taught authorities valuable lessons about early detection, screening and testing, as well as the need for collaboration between neighboring countries.
In the wake of the Ebola epidemic, the World Bank secured about $600 million to launch the Regional Disease Surveillance Systems Enhancement Project to bolster health and disease-surveillance systems across 16 West and Central African nations. These initiatives will certainly help the continent in the months ahead.
Although governments are generally cash-strapped, large companies, high-net-worth individuals and civil society organizations have contributed significantly toward preparation and relief efforts.
In South Africa, President Ramaphosa launched the Solidarity Fund in late March. Numerous executives in both the public and private sectors are donating a third of their salaries to the fund, which has so far raised more than R2.3bn ($121m).
Separately, wealthy South African families including the Rupert, Oppenheimer and Motsepe families have each made pledges of at least R1 billion to assist small businesses and workers affected by the pandemic.
There are similar examples across the continent. For Example, Nigerian billionaire Aliko Dangote has reportedly donated 2-billion naira ($5.2m) toward the West African country’s fight against Covid-19.
The private sector, in general, is certainly playing its part. Banking groups are providing loan repayment holidays to small businesses and other vulnerable customers, and many are contributing funds toward relief programs.
In Kenya, telecommunications group Safaricom is waiving transaction fees on its ubiquitous M-Pesa mobile-money service partly to discourage cash payments. The company is also using its network of some 176,000 agents to distribute personal protective equipment and sanitizers.
At the same time, beverage companies are using their facilities to make hand sanitizers, while retailers are piloting click-and-collect drive-through services to keep customers and employees safe.
While it is still early days, it is hoped that the decisive measures taken by local authorities will continue to "flatten the curve" and curb the spread of the virus.
The actions that governments, NGOs and businesses are taking during this time of crisis will undoubtedly shape their reputations for years to come.
The South African government—a serial underperformer in the trust arena, according to Edelman data—has been lauded for its decisiveness and transparency in the early days of Covid-19. Many businesses too have rekindled trust by acting with all stakeholders in mind. Further, this cooperation between business, the government and NGOs is unprecedented, and will hopefully endure long after the pandemic.
Jordan Rittenberry is CEO of Edelman’s Africa operations.
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