Our team is busy working to help people, governments and firms tackle the huge challenges caused by the COVID-19 crisis in the sectors we support.
The environment is uncertain and fast-moving – requiring a dynamic and flexible approach informed by solid evidence and up-to-date intelligence.
We are gathering information and talking to partners to help stakeholders coordinate and ensure sectors are in the best possible position to mitigate the impact, survive the crisis and thrive in the future. We will share more about our response as the situation evolves.
On this page we will also share useful information we have collected from other sources – we hope this may be helpful to others.
COVID-19 IMPACT ON EAST AFRICA – FORTNIGHTLY BRIEFING
Every two weeks we are working with our partners Msingi and Gatsby Africa to produce a briefing on the impact of the crisis in East Africa. This covers information on the macroeconomic impact, how the sectors we work in are being affected, and the donor response. It also includes links to useful trackers and sources of further information.
Week Commencing 3rd August Summary
The macroeconomic impact
Africa is nearing 1M cases of COVID-19. According to the UN, the number of hungry people worldwide is expected to increase by 82M-132M this year – with some 3.2M refugees in East Africa already receiving reduced rations. As international flights resume in Kenya, the Central Bank believes an economic recovery will start this month, sustained by a revival of remittances, the strong performance of agricultural exports, a rise in tourism bookings and a bumper crop of maize. The food security situation in Kenya improved in July, owing to the management of the locust outbreak, the long rain harvest and increased livestock production. The government – however – looks set to be short on resources, with the Kenya Revenue Authority reporting the COVID-19-related tax cuts are costing the public purse KSh 1B a day. In Tanzania, the Monetary Policy Committee observed the economy is performing “satisfactorily”, owing to output growth in construction, agriculture, transport and mining and strong export earnings from gold. Rwanda continues to receive international recognition for its management of COVID-19. In Uganda, the COVID-19-induced switch from cash to e-commerce appears set to stay and the country recorded its highest yearly export earnings from coffee.
The sector impact
Interest groups in the US, Europe and Kenya are pressuring the government in Kenya to scrap its COVID-19-related ban on the importation of second-hand clothing. In a bid to promote local value addition, Uganda has introduced a new import duty on textiles that reflects a 1000% increase. In worrying news for Kenya’s forestry sector, the country’s construction industry continues to falter, with contractors and suppliers complaining of a lack of access to finance. The downscaled Hajj in Saudi Arabia this year – which usually hosts millions of pilgrims – has left Kenya with thousands of unsold livestock which may now be sold at cut prices on the domestic market. The Kenya Revenue Authority have officially warned drinking water vendors, alleging a high number of firms have not been collecting or remitting excise duty
The donor response
UK’s DFID has officially announced a budget cut this year of £2.9B. The African Development Bank has loaned Rwanda $98M to strengthen its budget this year – and USAID has donated 100 ventilators to the county. Projecting more borrowing requests, the IMF has raised its annual loan limit for low-income countries. The World Bank transferred $50M to Kenya’s Equity Bank, with the condition the money is loaned to the country’s struggling SMEs. In light of COVID-19, the IKEA Foundation has pledged $3.5M to support the FAO’s work with refugees in Kenya and Uganda.
You can download the latest briefing for the week commencing 3rd August by visiting the Gatsby Africa Website.