The Final Call

The economics of Africa’s coronavirus pandemic

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One thing lacking in Africa’s fight against the coronavirus pandemic is consideration of what the aftermath of colonialism and neoliberalism has done to limit the effectiveness of African centered and controlled “public services.”

According to Crystal Simeoni, the Economic Justice leader at FEMNET, one of Africa’s largest women’s rights networks, “The coronavirus is bringing all of this to its fore.”

From her office in Nairobi, Kenya she told Africa Watch, “They’re still pushing this pandemic fund that’s been out for a while. They are still saying that most of the funding that will be available for African countries will be in the form of loans and recommending structural adjustments programs come back while we’re sorting all of this out.”

In other words, incur more debt from the International Monetary Fund and World Bank.

Ethiopian Prime Minister Abiy Ahmed urged G20 leaders to assist Africa with the coronavirus crisis by facilitating debt relief and providing $150 billion in emergency funding.

Abiy’s proposal came a day after Africa’s finance ministers called for $100 billion in “immediate emergency economic stimulus” including a waiver of debt interest payments.

“This $150 billion budgetary support package would come from the World Bank and crisis financing from the IMF,” the statement said, according to news.yahoo.com.

A recent forum in Senegal honoring the legacy of activist and economist Samir Amin was held under the theme “While Pan-Africanism Due To a Monetary Union Cannot Stand a Covid-19 Shock,” it warned the unfolding of a global economic crisis due to the Covid-19 pandemic could bring Africa’s nation states the usual mix of commodity export price crashes and a debt meltdown.

According to one of the forum presenters, the South African based researcher Riaz Tayob, who works for the South and East African Trade Information and Negotiations Institute or SEATINI, “Basically what we are talking about here is the entire continent, if I made a metaphor or a simile, the entire continent … is being turned into a mortgage backed security so that all the debt can be pulled so that we can pay back our debt with everyone converting their natural resources to meet the compounding interest of debt taken in the past. We are a CDP (collateralized debt obligation). And you know what these mortgage backed securities did in 2007.”

Simeoni, who has also done policy and advocacy work at the Pan-African level with governments, donors and organizational members at Tax Justice Network Africa, said, the “solution” for Africa “is taking cognizance that we need horizontal approaches to our development.” She said, “All oppression is linked.” She said philanthropy from the likes of Bill Gates “is part and parcel of the problem.”

European or American philanthropists like Gates put money into finding cures for a particular disease, but what Africa needs is a holistic approach, like putting money into developing Africa’s health system, she added.

Going further Simeoni said the idea of public-private partnerships “pushes the narrative that African states are incapable of providing for its citizens and that you need the private sector to provide.”

Africa’s weakness is partially the result of “illicit financial flows,” she said.

Illicit financial flows are money earned illegally and transferred for use elsewhere. According to a UN report, “Illicit financial flows and the Problem of Net Resource Transfers from Africa 1980- 2009,” the cumulative illicit outflows from the continent of Africa over a 30-year period ranged from $1.2 trillion to $1.4 trillion.

To paraphrase the former African Union ambassador to the United States, Dr. Arikana Chihombori-Quao, why are we spending so much time with African corruption when the real thieves are the European and U.S. governments and their multi-national corporations?

And though Simeoni seems to appreciate Chinese business mogul Jack Ma donations of 20,000 testing kits, 100,0000 masks, and 1,000 medical use protective suits and face shields to each one of 54 African nations, she wondered what African philanthropists like Mo Ibrahim and Nigerian business magnate Alhaji Aliko Dangote are doing to mitigate the pandemic? She said, “It’s time for African philanthropists to come and stand up and do something.”

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