Africa: What About Africa's Small, Medium Businesses During the COVID-19 Pandemic?

Social distancing in a Nairobi market.
5 June 2020

Cape Town — COVID-19's impact on big business across the continent is well documented, however, the pandemic's effect on small to medium business enterprises cannot be overlooked. Speaking during an online media briefing, Dr Matshidiso Moeti, the World Health Organisation (WHO) Regional Director for Africa, said that 70% of Africa's working population earns their livelihoods in the informal sector. As economic growth slows, Moeti said the UN Economic Commission for Africa projected that up to 27 million people could be pushed into extreme poverty due to the pandemic.

"At the WHO we are working closely with our sister UN agencies and other partners to mitigate the socioeconomic impacts," Moeti said. "We are encouraging a context-specific, risk-based approach with adjustments to facilitate physical distancing, improved access to handwashing facilities, and strengthened hygiene practices."

Moeti said the importance of grassroots activities - like a recent door-to-door campaign in Chad where information on COVID-29 was shared with over 33,000 people - help people to understand how they can protect themselves and others while also combating misinformation around the outbreak.

"On the public health front, several African countries have recently increased their testing capacities for COVID-19, including São Tomé and Príncipe where we deployed a team this past week. In some of these countries we're seeing an increase in cases and in others, new cases remain stable from week to week, indicating we need to remain vigilant to stop the spread of COVID-19," Moeti said.

Polio eradication expertise backs Africa's COVID-19 response

Expertise in polio eradication that has put Africa on the verge of being certified free of wild poliovirus has been brought to the frontlines of COVID-19 fight. A network of responders from the World Health Organization Polio Eradication Programme and partner organizations is providing critical resources and skills to tackle the COVID-19 pandemic.

"In Africa, no one has the footprint of the polio programme nor the expertise for mounting effective response campaigns. So with COVID-19 threatening to overwhelm health systems, the extensive polio response network is once again lending crucial support as countries build up systems to contain COVID-19," said Moeti.

Alongside the support to the COVID-19 response, WHO polio staff are also maintaining critical functions and planning to resume mass polio immunization campaigns once the situation permits. "It is important that the support to COVID-19 response does not jeopardize the progress made in stopping all forms of polio transmission in the region. The fight against the pandemic should not come at the detriment of other health emergencies," said Moeti.

Across the continent, COVID-19 has disrupted mass polio vaccination campaigns in line with the global physical distancing recommendations that limit COVID-19 transmission. The suspension of high-quality immunization rounds may risk new polio outbreaks due to low coverage.

Mali's response to COVID-19

Safia Boly, Minister of Investment Promotion, Small and Medium Enterprises and National Entrepreneurship in Mali, shared how COVID-19 has impacted the economic prospects of the informal sector in her country. "We have a strong economy that was growing at a steady 5% before the pandemic," she said. "When we were faced with the pandemic, which was declared in Mali in the middle of March, the government started a series of measures very early on in terms of checking temperatures at the borders before we went and eventually closed them."

Boly went on to share the latest COVID-19 statistics from Mali. "The Minister of health has been very active and dynamic in making sure that there's a very strong campaign of communication going on in terms of social distancing and in terms of other measures that need to be taken for prevention," Boly said. "As of today, we have about 1,200 confirmed cases. We have about 80 deaths and we have over 700 that have already left the hospitals and have been healed so from that perspective, it's a very bright horizon for us."

The economic impact of COVID-19 on Mali's economy has led to the government developing a "strong SMEs work program", according to Boly. "The Malian economy is multi-layered like many sub-Saharan countries. The two main contributors to our GDP are gold and cotton.

"We produced about 66 tons of gold last year and about 700,000 tons of cotton. Agriculture and agribusiness are very strong in Mali but if we look at the economy as a pyramid ... the bottom of the pyramid are very much the small enterprises which contribute about 70% to the economy, the majority of which are in the informal sector."

Boly explained how the informal sector reacted to the outbreak. "In the unstructured market, they were very much impacted by the pandemic in terms of the closure of the border."

Boly said that the country's curfew was an additional factor. "As a result, some of the SMEs that operated at night were heavily impacted for a period of about a month and a half and had to adapt and find resilience in their way of operating."

Mali's tourism industry was also heavily affected due to the lack of incoming travellers and the decision to close the nation's borders, Boly said. "We had however kept the borders open for cargo but, naturally, the rate of receiving cargo became slower and slower. Being a landlocked country, we depend heavily on importation and that means the factories in countries we bought cargo were not operating due to their own lockdowns," said Boly.

Questions and answers

There is an emerging training of thought that lockdowns are not effective in certain countries and that they do more harm than good. What are your comments?

Moeti: "That is a question heads of state, ministers of finance and health, cross-governmental committees and even we at the WHO have asked ourselves. The lockdowns have always been about keeping a balance between having an impact on the spread of the pandemic and minimizing its harmful effects on economies. I'm not aware of evidence that shows lockdowns are not effective in low-income settings. What we do know is that there had been projections of the virus's trajectory in Africa made by various groups, including ourselves. The slowing rate of cases in many countries, which we have seen, has given the opportunity to scale up public health capacities so that even as lockdowns are being eased, which is what is happening in countries now, the capacity is there and even if there is an initial uptick of cases, as we are seeing in countries like South Africa, be more capable of stopping a very out of control spread of the virus. The impact on economies, as Minister Boly explained, will be severe but we know an out of control spread of the pandemic could also overwhelm countries in other ways."

Boly: "Yes, there is something very important that we have asked as a message to our small and medium enterprises, which have also complained about the lockdown. We found means, specifically for meatpacking, bakeries, and the ones that were heavily impacted for them to have special access to very limited areas that allow them to maintain about 80% of their operations. In terms of the traffic of individuals, the lockdown helped tremendously at the start of the spread of the virus. It gave us a means to strengthen our health system, as Dr. Moeti has explained, but also psychologically it was important that we all put ourselves in this situation. It was always our intention for it to be a short-term lockdown."

There are now 162,000 COVID-19 cases in Africa with slightly over 4,000 deaths. With this increase, are African hospitals starting to feel pressure?

Moeti: "The significant increase in cases has been in about 10 countries; we have seen, of course, very a significant increase in South Africa, and there we know that the government has transformed the Cape Town Convention Centre into a field hospital, so some countries are very quickly ramping up capacity to provide care. There is also a large number of cases in Algeria, Nigeria, etc. I think what I can say is that some of the countries where there is a rapid increase are starting to feel the strain. They are looking at ways to increase capacity for case management. Just to make a note on asymptomatic cases, we are very much encouraging that countries set aside space for isolation of asymptomatic people without necessarily putting them in hospitals because it would be good to spare hospitals space for people who really do need medical care and not isolation."

Boly: "I believe we are doing very well because our numbers are still manageable. We have also transformed one of our large exposition areas into a possible expansion of our hospitals and have placed about 200 beds there to be ready in case our hospital system cannot cope with the current spread of the virus. As it stands, we have a little over 1,000 confirmed cases and 700 recoveries and about 70 deaths, so our hospitals are doing well."

How do we ensure that the reopening of the informal economy in South Africa is done safely and with a degree of regulation? Are there examples where this has worked?

Boly: "In Mali, our goal has been to help the informal economy grow. We are conscious that support provided tends to be focused on the formal economy because they require a level of structure or regulation that the informal economy doesn't. For example, with the cost of electricity, when it is reduced, it benefits everyone. The challenge with the informal economy is that there is no regulation. The best way is to have a broader support mechanism. I think the informal economy is far more resilient. At the moment, we are supporting different layers. For example, in the cotton culture in Mali, we have established a state-owned company that deals with cotton cultures and buys the cotton from those who grow and harvest it. The ones in the cotton culture that are growing it in rural areas, the large majority of them are in the informal sector. So the help we send them is done to all."

What can be done to improve the capacity of healthcare systems in Africa in the aftermath of the COVID-19 pandemic?

Moeti: "This is an important question. We have been working with governments in the region over a number of years, along with our work at a global level, on strengthening health systems with a view to progressing to universal health coverage and making sure people everywhere have access to essential and affordable health systems. It's very much about investing more in health; I think there is no doubt governments have to invest more in health. We emphasise a lot on working on primary health care so that there is a decentralisation of infrastructure so that, even if it's a simple health centre, people can have a place where they can find a nurse, if necessary, a community health worker, with a good chance of being referred if they have a complicated illness to a higher level facility where they will find people who are competent."

Boly: "If there's one thing the pandemic has created is the understanding - across the whole nation - that the responsibility to provide healthcare to citizens is not solely that of the government. We have come to a place where we have a very strong private/public partnership; our chamber of industry and commerce has put in place many measures for small industries to produce sanitiser and masks. When it comes to the actual infrastructure for healthcare, what we have really come across is that it's a dual responsibility for the private sector to establish financing and for the government to provide the architecture for it."

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