Financial Sector Readiness to Support Economic Actives under COVID-19: The Case of African Continent

19 Pages Posted: 13 Aug 2020 Last revised: 29 Oct 2020

See all articles by Ernest Christian Winful (PhD)

Ernest Christian Winful (PhD)

Accra Technical University

David Sarpong

Accra Polytechnic

Irenee Dondjio

The Hague University of Applied Sciences

Date Written: August 6, 2020

Abstract

The magnitude of COVID-19 is yet to be estimated and felt by countries. The pandemic has posed a major disruption to economic activity across the world. Using the model by Battese, G.E., Coelli, T.J. (1995) the translog production frontier was adopted to estimate technical efficiency of the financial sector of the continent. The 24 countries selected were based on the availability of data to cover our variables of interest. The findings were that generally the financial sector in the continent have performed above average (72%) over the period of study. Also lower middle income countries are relatively going to have more problems with pandemic. However, the probability of the continent not plunging into economic depression with the support of the financial sector is 0.42 which is not encouraging. It is recommended that policies to address interest rate margin, liquidity and market concentration should be managed properly to improve technical efficiency of the financial sectors of the continent. This will ensure that relief packages and grants are managed properly.

Keywords: Africa, COVID-19, Financial Sector, Technical Efficiency, Translog Production Frontier

JEL Classification: G2, E4

Suggested Citation

Winful (PhD), Ernest Christian and Sarpong, David and Dondjio, Irenee, Financial Sector Readiness to Support Economic Actives under COVID-19: The Case of African Continent (August 6, 2020). Available at SSRN: https://ssrn.com/abstract=3668275 or http://dx.doi.org/10.2139/ssrn.3668275

Ernest Christian Winful (PhD) (Contact Author)

Accra Technical University

Ghana

David Sarpong

Accra Polytechnic ( email )

Barnes Road
Accra
Ghana

Irenee Dondjio

The Hague University of Applied Sciences

Johana Westerdijkplein 75
The Hague, Zuid Holland 2521 EN
Netherlands

Do you have a job opening that you would like to promote on SSRN?

Paper statistics

Downloads
38
Abstract Views
992
PlumX Metrics