Although the number of COVID-19 cases and fatalities might still appear comparatively lowin Africa than in other world regions,the looming health shock of COVID-19 could have disastrous impacts on the continent’salready strained health systems,and couldquickly turn into a social and economic emergency. Beyond health risks, the COVID-19 shock to African economiesiscoming in three waves: (i) lower trade and investment from Chinain the immediate term;(ii) a demand slump associated with the lockdowns in the European Unionand OECD countries; and (iii) a continental supply shock affecting domestic and intra-African trade.
It is shaking commodity-driven growth modelsthat hadlargely failed to create more and better jobs or improve well-being. On the health front, greater capacities to test, protect, treat and cure are essential. On the socio-economic front, policy measures should cushion income and jobs losses, while tackling the specific challenges of high informality. Beyondthe immediate response, recovery strategies shouldinclude a strong structural componentto reduce dependenceon external financial flows and global markets, and develop more value-adding, knowledge-intensive and industrialised economies, underpinned by a more competitive and efficient services sector. Effectiveimplementation of the AfricanContinental Free Trade Area(AfCFTA)and the African Union’s productive transformation agenda can strengthen regional value chains, reduce vulnerability to external shocks,advance the digital transition, and build economic resilience against future crises.
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