“Almost all the progress Africa has made over the past decades could be eroded,” said ACET President K.Y. Amoako. “Tens of millions are expected to be pushed back into poverty. The question for all of us is what policies do we need to put in place now to get back on the transformation track?”
Amoako was joined on the panel by International Monetary Fund (IMF) Africa Department Director Abebe Aemro Selassie; ACET Executive Vice President Mavis Owusu-Gyamfi; and Prof. Benno Ndulu, former governor of the Bank of Tanzania. More than 160 participants attended the Zoom discussion.
Titled “Priorities for Africa’s Recovery, Growth, and Transformation,” the webinar offered each panelist an opportunity to discuss in some detail their views on the best way in which governments can address short-term problems either caused or exacerbated by the pandemic without losing sight of long-term goals, including economic transformation.
The theme derived from a list of 10 policy priorities recently published by ACET to help support governments as they look beyond their immediate responses. Owusu-Gyamfi presented the priorities, which were grouped in four broad categories: resource mobilization and management, governance, effectiveness, and transparency; business and investment environment; and digital innovation and entrepreneurship.
“These four priority areas are the right ones,” Selassie said, adding that they encompass “how we might see the next few years” in development terms.
Selassie warned that even though COVID-19 caseloads in Africa remain low compared to the rest of the world, the global environment will be dramatically different in the years ahead and that developing countries on the continent must adapt.
“Every country will have to rethink development strategy,” he said. “Africa cannot expect the external environment to be as favorable as it was. We are going to have to look inward.”
For example, he said, Africa’s “social contract needs to be reset” to foster greater trust and collaboration between governments and citizens and enable countries to move toward a future growth period financed by domestic revenues, not debt or development assistance. In this regard, policymakers would need to be “politically brave enough” to ask all people “to pay their fair share.”
Owusu-Gyamfi reiterated that certain revenue-related policies—such as closing tax loopholes, improving expenditure management, and holding line ministries accountable—can have powerful, long-term effects on overcoming the recent economic setbacks. But, she said, “it’s important that citizens feel confident about what is being done.”
Panelists also emphasized the increased importance of technology and digitization as engines of post-COVID-19 growth—“Any country that does not invest in this type of infrastructure is going to suffer,” Selassie said—as well as the need for governments to improve their investment environments in order to create more jobs.
“Investors have choices on where to invest,” Owusu-Gyamfi said. “If we want investors in Africa, we need to be more competitive nationally, regionally, and globally. Africa’s infrastructure investments after COVID-19 need to ensure it is easier to do business.”
The pandemic has exacted a heavy toll on global economies, with Africa hit especially hard. According to the World Bank, the continent is expected to experience its first recession in 25 years. And a recent update to the African Development Bank’s flagship economic outlook report projects up to 50 million additional Africans could enter extreme poverty by 2021.
Toward the end of the discussion, ACET Director and Senior Advisor Rob Floyd described how ACET is working in collaboration with the World Bank and other development partners to implement the policy priority framework in a select number of countries, based on feedback from government economists and other stakeholders.
“The IMF, World Bank, African Development Bank, and G20 have all been supporting on the emergency measures, but now we’re looking forward to how we secure a strong economic rebound after the crisis,” Floyd said. “The big challenge is the how, not the what.”
Selassie said he believed that governments would be able to adapt as needed. And he pointed out that despite the withering external shock brought on by the pandemic, the positive gains made over the past two decades have enabled economies to be in a position to fight back.
“The resilience we are seeing in many countries would have been seen just 15 or 20 years ago,” he said. “So yes, I remain optimistic.”
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