The Aftermatch of the Coronavirus in Selected African Economies

7 Pages Posted: 1 Apr 2020

See all articles by Professor Alain Ndedi

Professor Alain Ndedi

International Council for Family Business; ISTG-AC; YENEPAD; Saint Monica University; University of Johannesburg; University of Pretoria; Charisma University

Date Written: April 1, 2020

Abstract

African countries have been among the last to be hit by the global coronavirus pandemic. Yet, as the cases rise and governments rightfully take the necessary measures to slow the spread of the virus, the continent is likely to face widespread economic fallout as business slows to a near halt. Some countries like Angola and Nigeria, were already going to feel the pain from an oil price war – largely driven by a falling out between Saudi Arabia and Russia – but a pandemic that has already pummelled stock markets across the globe will only be an add-on to the unavoidable economic damage expected in the short term for these countries.The reality is that many countries across the globe are on recession watch…some countries may already be in a recession (albeit not yet by the technical rules of a fall in GDP in two successive quarters). For Algeria, things are very complicated because the country does not have a pro-business energy policy. The perennial issue the hydrocarbons law still has not been reformed. Add to that the problems of security and corruption, and you end up with conditions that are unfavourable to private investment. Moreover, oil companies have seen billions of dollars of their value wiped out losing 10% to 15%. This will therefore limit investment.

The COVID-19 could lead to Africa’s export revenues from fuels falling at around US$ 101 billion in 2020. Remittances and tourism are also being affected as the virus continues to spread worldwide, resulting in a decline in FDI flows; capital flight; domestic financial market tightening; and a slow-down in investments – hence job losses. Pharmaceuticals, imported largely from Europe and other COVID-19 affected partners from outside the continent, could see their prices increasing and availability reduced for Africans. With nearly two-thirds of African countries being net importers of basic food, shortages are feared to severely impact food availability and food security. Negative consequences are expected to worsen with the crisis becoming a pandemic. In addition, a decline in commodity prices could lead to fiscal pressures for Africa’s economic power houses such as South Africa, Nigeria, Algeria, Egypt and Angola.

Keywords: COVID 19, Africa, Economy, Pandemic

Suggested Citation

Ndedi, Alain Aime, The Aftermatch of the Coronavirus in Selected African Economies (April 1, 2020). Available at SSRN: https://ssrn.com/abstract=3565931 or http://dx.doi.org/10.2139/ssrn.3565931

Alain Aime Ndedi (Contact Author)

International Council for Family Business ( email )

San Diego
United States

ISTG-AC ( email )

Douala
Cameroon
Douala, WY Littoral 2012

YENEPAD

PO Box 30069
Suunyside
Pretoria, Pretoria 0135
South Africa
+27 84 992 9499 (Phone)

HOME PAGE: http://yenepad.virtualactivism.net

Saint Monica University ( email )

P.O. BOX 132
Buea, South West
Cameroon
237698727474 (Phone)
23767992-0777 (Fax)

HOME PAGE: http://www.stmonicauniversity.com

University of Johannesburg ( email )

UJ ADMINISTRATION. University of Johannesburg
PO Box 524. Auckland Park 2006.
Johannesburg, Gauteng
South Africa

HOME PAGE: http://www.uj.ac.za

University of Pretoria ( email )

University of Pretoria,
Private Bag X20, Hatfield,
Pretoria, Gauteng
South Africa

HOME PAGE: http://www.up.ac.za

Charisma University ( email )

30 Sandcastle Rd
Neptune CT, Grace Bay
Providenciales
Turks and Caicos Islands

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