"Charting a path for a resilient recovery in Sub-Saharan Africa"

" \n Perhaps first among the many lessons of 2020 is that the notion of so\u2011called \u201cblack swan\u201d events is not some remote worry. These purportedly once\u2011in\u2011a\u2011generation events are occurring with increasing frequency. \n \n\n \n Take climate\u2011related shocks, especially in sub\u2011Saharan Africa. More than any other region, it is vulnerable to these events because of its heavy dependence on rain\u2011fed agriculture and its limited ability to adapt to shocks. Every year, the livelihoods of millions are threatened by climate\u2011induced disasters. \n \n\n \n As we all continue to grapple with the COVID\u201119 crisis, policymakers also need to look ahead. Countries need to ensure that the vast global fiscal support deployed to fight the pandemic also works to build a smarter, greener and more equitable future. \n \n\n \n Nowhere is that more important than in sub\u2011Saharan Africa. It is where the needs are greatest and also home to the world\u2019s youngest population, creating added urgency to act now to build forward better. Together, we need to chart a path to a more resilient recovery. \n \n\n \n Why resilience matters \n \n\n \n Our <a href=\"https:\/\/lnks.gd\/l\/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDQsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMDA5MTUuMjcxMzIwNDEiLCJ1cmwiOiJodHRwczovL3d3dy5pbWYub3JnL2VuL1B1YmxpY2F0aW9ucy9SRU8vU1NBL0lzc3Vlcy8yMDIwLzA0LzAxL3NyZW8wNDIwP3V0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.jLuLY2NYOXGkimdEdGGSJoCVOauAnv6TNM2fcpP-TdY\/s\/1181822789\/br\/84908056055-l\" target=\"_blank\" rel=\"noreferrer noopener\">Regional Economic Outlook for sub-Saharan Africa published earlier this year highlights the lasting damage in the region from climate events. Over the medium term, annual per capita economic growth can decline an additional 1 percentage point with each drought. That impact is eight times worse than for an emerging market or developing economy in other parts of the world. \n \n\n \n <a href=\"https:\/\/lnks.gd\/l\/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDUsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMDA5MTUuMjcxMzIwNDEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvMjAyMC8wOS8xNS9jaGFydGluZy1hLXBhdGgtZm9yLWEtcmVzaWxpZW50LXJlY292ZXJ5LWluLXN1Yi1zYWhhcmFuLWFmcmljYS8_dXRtX21lZGl1bT1lbWFpbCZ1dG1fc291cmNlPWdvdmRlbGl2ZXJ5In0.sWfSJWQXebWMZDtaHnt5OdgKjOmKJkpO4mxdcC-sBxg\/s\/1181822789\/br\/84908056055-l\" target=\"_blank\" rel=\"noreferrer noopener\"> \n \n\n \n Nelson Mandela once said: \u201c do not judge me by my successes, judge me by how many times I fell down and got back up again .\u201d \n \n\n \n Given the increased frequency of shocks, building capacity to withstand them becomes essential to protect development gains. \n \n\n \n Take investing in a smarter, digital economy. In another <a href=\"https:\/\/lnks.gd\/l\/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDYsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMDA5MTUuMjcxMzIwNDEiLCJ1cmwiOiJodHRwczovL3d3dy5pbWYub3JnL34vbWVkaWEvRmlsZXMvUHVibGljYXRpb25zL1JFTy9BRlIvMjAyMC9BcHJpbC9FbmdsaXNoL2NoMy5hc2h4P2xhPWVuJnV0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.mfQW-zQuOwF40WmZA3DGe6-VoD-YDz3i83KLOIWqRa4\/s\/1181822789\/br\/84908056055-l\" target=\"_blank\" rel=\"noreferrer noopener\">chapter of the Regional Economic Outlook we found that expanding internet access in sub\u2011Saharan Africa by 10 percent of the population could increase real per capita GDP growth by as much as 4 percentage points. \n \n\n \n In other words, a recovery that raises resilience will not just save lives, but will also translate into higher living standards, better\u2011quality jobs, and more opportunity for all. \n \n\n \n To achieve this, fiscal and financial policies need to prioritize investing in people, infrastructure, and coping mechanisms. \n \n\n \n Empowering people \n \n\n \n Investing in healthcare and education can pay large dividends in terms of growth, productivity, gender equity, and living standards. But investing in people is also critical for building resilience. \n \n\n \n People who are physically resilient spend less on extra medical care and, if they do fall sick, they return to work or school sooner. \n \n\n \n Of course, good health depends on good nutrition. When a climate shock hits, having <a href=\"https:\/\/lnks.gd\/l\/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDcsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMDA5MTUuMjcxMzIwNDEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvMjAyMC8wNi8wNC9zYWZlZ3VhcmRpbmctYWZyaWNhcy1mb29kLXNlY3VyaXR5LWluLXRoZS1hZ2Utb2YtY292aWQtMTkvP3V0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.cT1jjEEmT14xCqW1z70HJQZnUiJgvSdVJXCt-jDbTCA\/s\/1181822789\/br\/84908056055-l\" target=\"_blank\" rel=\"noreferrer noopener\">access to enough safe and nutritious food is essential to survival. And this is where better education on the impact of climate change can help countries safeguard agricultural output. In Chad, for example, farmers are improving water retention through new rainwater harvesting techniques. \n \n\n \n Access to new technologies can help farmers and doctors. Sierra Leone launched a new drone corridor last November, the first in West Africa, to monitor agricultural conditions and enable rapid delivery of medicine. Better mobile phone networks mean better access to early warning systems and weather information\u2014even in the form of simple voice messages\u2014that enable more productive and climate\u2011smart agriculture. \n \n\n \n But investing in people is more than just finding better ways to do existing jobs. It is also about carving out new jobs. Better jobs. It is therefore vital to invest in building digital skills. \n \n\n \n Our analysis shows that, on average, digitally\u2011connected firms in the region employ eight times more workers, and create higher skilled, full\u2011time jobs. Also, increased internet penetration is associated with a larger share of women working in the services sector\u2014the shift to more employment in services is two and a half times larger for women than men. \n \n\n \n Enhancing infrastructure \n \n\n \n Good infrastructure is the backbone of any healthy and resilient economy. However, in a region where large\u2011scale infrastructure investments are already badly needed, there is an added premium on infrastructure investments that are smart, green and inclusive. \n \n\n \n While the pandemic seems set to accelerate sub\u2011Saharan Africa\u2019s digital transformation, this won\u2019t happen by itself. It requires substantial investment in infrastructure\u2014both digital\u2011friendly traditional infrastructure (including more reliable electricity) and digital\u2011ready information technology infrastructure. \n \n\n \n Almost all countries in the region, except just a few, are connected through submarine cables or via cross\u2011border terrestrial links. But more needs to be done to improve digital access within countries and to reverse the widening gender gap. \n \n\n \n At the same time, countries faced with the ravages of climate events need greater investment in weather\u2011resilient infrastructure. For instance, Mozambique\u2019s Beira Port\u2014a major regional trade and transportation hub\u2014was operational within days of each of two consecutive cyclones thanks to extensive drainage systems and well\u2011constructed buildings and roads. \n \n\n \n Digital and climate-resilient infrastructure can go hand\u2011in\u2011hand. One\u2011fifth of sub\u2011Saharan Africa\u2019s electricity is generated from hydropower\u2014which is susceptible to droughts\u2014so we need greater efforts to diversify electricity sources over the long run. \n \n\n \n This means moving towards other renewable energy sources, such as solar and wind power. This shift will help reduce carbon emissions, spread electrification, and create jobs. In Kenya, the government increased access to electricity from 40 to 70 percent of the population in large part through the use of small, off\u2011grid, solar\u2011powered energy plants. The added bonus is that the pay\u2011as\u2011you\u2011go, mobile money model makes this initiative accessible and easy to expand, plus it created 10 times more jobs than in traditional utilities. \n \n\n \n Strengthening coping mechanisms \n \n\n \n Following a shock, social assistance and access to finance, among others, act as buffers that help people and businesses cope. They compensate for lost income\u2014allowing households to smooth consumption and buy essentials like food\u2014and make it possible for businesses to continue operating. \n \n\n \n A good example is Ethiopia\u2019s Productive Safety Net Program, which provides emergency cash transfers to food\u2011insecure households. By requiring recipients to use bank accounts, the transfers are received quickly and financial inclusion has improved. \n \n\n \n Broadening access to finance for low\u2011income households and small businesses helps them better cope during a shock. It also makes it easier for households to empower themselves by investing in health, education, and so on, and for businesses to invest in productive projects. \n \n\n \n Where digitalization supports better policy design and better economic outcomes, it can be a win\u2011win. \n \n\n \n Governments are also taking advantage of the region\u2019s leadership in mobile money to provide immediate support to households and businesses, while promoting social distancing. For instance, Togo\u2019s \u201cNOVISSI\u201d social protection program uses mobile money and electronic cash transfers to support informal sector workers impacted by COVID\u201119. \n \n\n \n <a href=\"https:\/\/lnks.gd\/l\/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMDksInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMDA5MTUuMjcxMzIwNDEiLCJ1cmwiOiJodHRwczovL2Jsb2dzLmltZi5vcmcvMjAyMC8wOS8xNS9jaGFydGluZy1hLXBhdGgtZm9yLWEtcmVzaWxpZW50LXJlY292ZXJ5LWluLXN1Yi1zYWhhcmFuLWFmcmljYS8_dXRtX21lZGl1bT1lbWFpbCZ1dG1fc291cmNlPWdvdmRlbGl2ZXJ5In0.hm5tCFAPkGrG4QnqjBERhWqTdqpY3LH3dq2uZUc89EQ\/s\/1181822789\/br\/84908056055-l\" target=\"_blank\" rel=\"noreferrer noopener\"> \n \n\n \n One thing is clear: achieving a resilient recovery in sub\u2011Saharan Africa, as elsewhere, will not be easy. \n \n\n \n For one, it will be expensive. Precisely estimating the costs is not easy given complementarities between investments in people, infrastructure, and policies. But it will certainly be in the hundreds of billions of dollars in the coming years. \n \n\n \n Meanwhile, of course, the COVID\u201119 crisis is taking a toll on the region\u2019s already limited fiscal space. And even before the crisis, most countries\u2019 public debts were increasing rapidly. \n \n\n \n Second, it will require transformative reforms. Important as external support will be, it will be neither effective nor sufficient unless policy-induced distortions that stymie private investment are eliminated or public finance management systems improve. More domestic revenue mobilization will also be imperative\u2014something which digitalization can help by improving the efficiency of collection. \n \n\n \n Third, support from the international community will be vital. Stepped\u2011up debt relief, financing, and capacity development will all be needed. The IMF is supporting the recovery in sub\u2011Saharan Africa <a href=\"https:\/\/lnks.gd\/l\/eyJhbGciOiJIUzI1NiJ9.eyJidWxsZXRpbl9saW5rX2lkIjoxMTAsInVyaSI6ImJwMjpjbGljayIsImJ1bGxldGluX2lkIjoiMjAyMDA5MTUuMjcxMzIwNDEiLCJ1cmwiOiJodHRwczovL3d3dy5pbWYub3JnL2VuL1RvcGljcy9pbWYtYW5kLWNvdmlkMTkvQ09WSUQtTGVuZGluZy1UcmFja2VyP3V0bV9tZWRpdW09ZW1haWwmdXRtX3NvdXJjZT1nb3ZkZWxpdmVyeSJ9.1Rq2n9RaIx45uIAyS_S1m_M9SE5EcpXSgFKLf4VbiA8\/s\/1181822789\/br\/84908056055-l\" target=\"_blank\" rel=\"noreferrer noopener\">through all three of those channels . And we certainly will be doing more in the years ahead. \n \n\n \n As we noted at the outset by invoking Nelson Mandela, getting back up after being knocked down is key. \n \n\n \n The fact is investing in a more resilient future will be more cost\u2011effective than repeated rebuilding after crises or disasters. \n \n\n \n That should be the measure of today\u2019s success\u2014encouraging a more virtuous cycle and more resilient development path for the region. \n "

"Charting a path for a resilient recovery in Sub-Saharan Africa"

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