June 26, 2020/United Capital Report

Like in many continents, the outbreak of the novel Coronavirus is having a negative impact on African economies, changing the overall economic outlook for countries in the region from that of expansion (earlier expected at the beginning of the year) to a broad-based contraction/slowdown. However, we believe there are lessons for African leaders to learn from this crisis. Herein, we highlight the critical lesson and recommendations.

One key lesson for Africa is finding a way to reduce her huge dependence on external economies. Although African countries were the last to record rapid cases of COVID-19, globally, the economic impact of the virus transcended the outbreak within African countries. Clearly, the outbreak of the virus within Asia, Europe, and America exposed the overdependence of African countries on trade as well as financial market flows.

Certainly, the African Continental Free Trade Area (AfCFTA) was designed with the intent to correct this vulnerability. As such, as restriction on the lockdown is increasingly phased out,  our view is that discussion on the implementation of the AfCFTA agreement remains a priority, while promoting policies to sustain cross border  industrialization of the continent.

Top African Stories

• South Africa rolls out continent’s first trials for COVID-19 vaccine: Oxford University rolled out Africa’s first human trials for a potential vaccine against the new coronavirus in South Africa on Wednesday, as cases continue to rise and concerns grow over potential access to life-saving treatments. Read more

• Nigerian banks to restructure over a third of loans -MPC member: Nigerian banks plan to restructure over a third of loans after running into repayment problems due to the coronavirus pandemic, a member of the central bank monetary policy committee said . Read more

• Kenya central bank holds benchmark lending rate at 7.0%: Kenya’s central bank held its benchmark lending rate at 7.0% on Thursday, saying the easing measures it had adopted since the onset of the coronavirus crisis in March were having the intended effect . Read more

• Egypt’s central bank keeps key interest rates on hold – statement: The Central Bank of Egypt (CBE) kept its main interest rates steady on Thursday, despite a decline in inflation in May and continuing economic pain caused by the coronavirus , Read more 

• Djibouti sets up sovereign wealth fund, targets $1.5 bln in 10 years: Djibouti is setting up a sovereign wealth fund for domestic and regional investment, aiming to fund it to the tune of $1.5 billion over the next decade, the government said on Thursday . Read more

• Congo announces end of Ebola outbreak in east, second deadliest on record: The second-largest Ebola outbreak on record is over after nearly two years and more than 2,200 deaths .Read more

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