Challenging Post Covid-19 Economic Recovery Measures

It is now trendy to hear financial institutions like the International Monetary Fund (IMF) and countries across the world talking about the need to relaunch the global economy following the recession caused by the Coronavirus pandemic. In the process, one country after the other has been filing past the IMF corridors with loan applications that will supposedly enable them to recover from the damage resulting from Covid-19.
That was certainly to be expected following the generalized lockdown that the world suffered in 2020. No one could have prepared for any such eventuality since the phenomenon took the world by surprise. What started in Wuhan Province in China in December 2019 suddenly took the world by storm in 2020 as the death toll kept rising from one country to the other with the spread of the disease. It subsequently resulted in the closure of borders and the prohibition of the movement of people from across the globe.
In the process, online transactions took centre stage and the digital economy witnessed a boom. But from every indication, the shift to online businesses could not salvage the world’s economy thereby pushing of Africa to record an all-time drop in growth rate to less than 2 per cent in 2020. With the roll out of various vaccination programmes supported by international partners, Africa, like the rest of the world, is counting its successes in the face of the pandemic. This means the economy can also see a positive outcome in the months ahead. Experts are even talking of prospects of 3.8 per cent growth in 2021.
One factor being cited as the reason behind the glimmer of hope being predicted worldwide has to do with various loan schemes adopted by the IMF. Such an initiative can quickly be judged as laudable since countries have at various moments counted so much on the same institution for economic bailout. However, there is worry about how effective support from the IMF can be to enable especially Third World countries regain their previous growth perspectives. Ills like corruption, nepotism, mismanagement of public funds, internal conflicts and other civil disorders that tend to dilapidate scarce resources in Africa, in particular, are still rife. Even in the heart of the Covid-19 pandemic in 2020 some of the funds dished out by the IMF to help countries tackle the disease were reportedly siphoned. African countries that have not suffered the same pernicious effects from Coronavirus as Asian and Western nations are well on track to suffer the burden of heavy loans contracted to recover from the effects of the disease. This may sound strange, but the fact remains that no African country is free from incurring loans to tackle the aftermath of the pandemic. But just how far the loans will effectively tackle the core issues of poverty will be a matter of conjecture.

Speaking at the Annual Meeting of the African Development Bank on 23 June, 2021, the Managing Director of the International Monetary Fund, Kristalina Georgieva, pointed out that the pandemic has been a human tragedy and an economic calamity. As such, she insisted on general mobilization to overcome setbacks to economies. Scary statistics like public debt levels which were already too high in Africa reportedly jumped from 6 per cent points to 58 per cent of GDP in 2020 in Sub-Saharan Africa. It therefore means that the areas for assistance to Africa to continue to tackle the pandemic and ensure economic recovery will matter a lot. Secondly, experts are all agreed that the only way to deal with debt is for the economy to grow. Yet, the lack processing structures in Africa has often subjected economies to fluctuations in the world market. Seemingly, the best hope for Africa at this period of post Covid-19 recovery is to develop home-grown solutions to ensure growth. Assistance from development partners may never be absent, but will always seems to pose a problem. Reason why African countries must to take their destinies into their own hands.

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