Post COVID: Economic Impact East, Central and South Africa
The COVID Economic impact has hit Africa as it has the rest of the world. Although the economic toll of the virus remains unclear as the world faces an unprecedented global recession, Africa is always hard hit, no matter the origin of the problem.
In most countries, COVID-19 resulted in restrictions on movement, increasingly causing people to rely on the internet for work, education, commerce, and entertainment. As a result, data usage has soared and telecommunication companies are working hard to fulfil this increased demand.
Economic losses from COVID in East, Central and South Africa
When the spread of the virus slowed and lockdown regulations were relaxed in most parts of the region, this led to strong agricultural growth and a recovery in commodity prices, helping many African economies. Economic recovery depends on countries focusing on reforms that create jobs, encourage investment, and enhance competitiveness. Continuing the drive to develop digital technology is key to transforming the economies of East, Central and South Africa.
Data on Economic Cost of COVID in Africa
It has been estimated that COVID-19 would take African economies into a fall of about 1.4% in GDP, with smaller economies facing up to 8% contraction. This contraction is primarily a result of export adjustments which have affected primary commodity exporters, and the knock-on losses to tax revenue. These then reduce the government’s capacity to extend public services needed to respond to the crisis. Overall, a regional average loss of about 5% has been forecast, with a contraction of about 17% on total merchandise export.
It follows then that Africa needs strong ICT sector development. Only with legal and regulatory frameworks that facilitate cybersecurity, protection and privacy of personal data, digital payment methods, and furthering of the growth of financial technology startups can Africa hope to be competitive.
Data on Economic Cost of COVID in South Africa
Lockdowns and reduced turnover have led to massive staff retrenchments and business closures. In just the third quarter of 2021, Gauteng alone saw 200 000 job losses! Businesses were forced to dig deep into their reserves or go into debt to stay open, but many did not. Comprehensive data is still unavailable but the costs have been staggering.
Cost of Treating and preventing the COVID disease
Direct costs such as hospitalizations and vaccinations are possible to quantify, but the less direct costs are almost unquantifiable. Containment measures implemented by governments were costly and had a huge impact on the tourism industry especially.
Thankfully, accelerated digitization such as video conferencing systems allowed greater access to healthcare and other essential services.
Effect of COVID on quality of life and poverty
According to Stats SA, children and the poor have been hardest hit by COVID 19 in terms of quality of life. Children were unable to engage in normal school and social life and the long term effects of this are mind-boggling.
Poverty reduction in Africa – and specifically South Africa – remains the top priority.
Economic Future In East, Central And South Africa
Sub-Saharan Africa’s recovery from the effects of the pandemic will vary across countries and regions. For example, mining-dependent economies, such as Botswana, are expected to see robust growth in 2022, while other commodity-driven economies may take longer to recover.
Measures to improve the customer experience, such as better network reliability, greater access to networking services, and increased capacity, are now longer a marketing role, but essential to the economic survival of the region’s economy.
COVID-19 Conditions And Macroeconomic Impact: Supply And Demand Shocks Will Have A Strong Impact On Growth And Development
Sub-Saharan Africa is a diverse region and no single regeneration plan can apply for all the countries within the region. The huge area which is home to over a billion inhabitants offers a bounty of human and natural resources which can potentially yield inclusive growth and eradicate regional poverty. This could enable Africans to raise their standard of living to higher than it has ever been. Sub-Saharan Africa is the world’s biggest free trade area, which has the potential of creating a new development path for a better future.
Looking forward, leaders in telecoms must focus on responding, recovering, and thriving in a post-pandemic world.
Contact AFR-IX Telecom for more information about a reliable network in East, Central, and South Africa.