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Kenya’s GDP Contracts Under Weight of COVID-19, Impacting Lives and Livelihoods

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The latest World Bank economic analysis for Kenya projects the economy to contract by between 1.0 percent and 1.5 percent in 2020, as ongoing COVID-19 containment measures and behavioral responses restrict activity in Kenya and its trading partners.

The Kenya Economic Update, Navigating the Pandemic, notes the downturn in economic growth reflects the more severe economic impact of the pandemic to date than had been initially anticipated, including a large impact on the national accounts of the closure of education institutions since March. In response, the government has deployed both fiscal and monetary policies to support the healthcare system, protect the most vulnerable households, and support firms to help preserve jobs, incomes and the economy’s productive potential. With a sharp decline in tax revenues due to the weakening in economic activity, and tax relief, and an increase in COVID-related spending needs, the fiscal deficit has widened, and debt vulnerabilities have risen. The fiscal deficit widened to 8.2 percent of gross domestic product (GDP), up from the pre-COVID budgeted target of 6.0 percent of GDP, and Kenya’s debt to GDP ratio has risen to 65.6 percent of GDP as of June 2020, up from 62.4 percent of GDP in June 2019.

“As the COVID-19 pandemic continues to threaten both the lives and livelihoods of Kenyans, we remain committed to supporting the government to allocate sufficient resources to the health sector to combat the pandemic, continue with mass testing, support self-quarantine, social distancing, and protect the most vulnerable groups,” said Keith Hansen, World Bank Country Director for Kenya. “It is equally critical to provide well-targeted support to the most vulnerable affected households.”

Beyond strengthening health systems and protecting incomes, the report recommends several near-term actions that can play a role to combat recession and revive the economy’s productivity, creating the conditions for a resilient and inclusive recovery. Ensuring continued access to safe healthcare, including for non-COVID-19 related health concerns, remains a priority. Given fiscal constraints, this will require redirecting expenditures to the highest priority areas, whilst maintaining a focus on raising the efficiency of spending and ensuring the transparent use of funds.

Following the job and income losses precipitated by the crisis, the report notes support is needed for the “new poor” whose livelihoods have been affected. This could be achieved through a horizontal scale-up of social protection programs, appropriately targeted, timely, and temporary while the crisis persists.It is critical to ensure continued support to vulnerable households, while safeguarding human capital through expanded access to digital technology, combined with better access to information to mitigate usage of negative coping strategies (i.e. asset liquidation) and combat food insecurity while offsetting the increase in poverty.

“Following the extraordinary economic support efforts necessitated by the crisis, Kenya’s economic recovery can be supported by the authorities returning to an appropriately-timed and balanced fiscal consolidation path, to reduce mounting debt vulnerabilities and safeguard macroeconomic stability,” said Alex Sienaert, World BankSenior Economist and lead author of the report. “Kenya will also need to enhance its existing institutional setup for monitoring and responding to future communicable disease outbreaks, and further the still-critical “Big 4” agenda for medium-term inclusive growth, including realizing the government’s vision of sustainably providing universal healthcare.”

Kenya’s economic outlook remains highly uncertain, as the COVID-19 pandemic continues to unfold in the country, and globally. Under baseline assumptions, the economy is projected to rebound quickly in 2021, lifting real GDP by 6.9 percent y/y. A major factor in this strong rebound is the unusual impact on the national account’s treatment of education sector output normalizing, which is projected to add 2.2 percentage points to real GDP growth next year.Delayed availability of vaccines, and prolonged social distancing and other needed COVID-19 countermeasures, could undermine the projected recovery in economic activity.

The report’s policy section focuses on options to strengthen healthcare system and testing capacity, to support firms, and to protect the most vulnerable households to cope with the COVID-19 global pandemic.

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Africa Today

‘Overzealous’ security services undermining South Sudan peace

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South Sudan has suffered years of underdevelopment, corruption and conflict. UNMISS/Amanda Voisard

State security forces in South Sudan have been responsible for imposing new and potentially arbitrary restrictions against the country’s most prominent civil society leaders, issuing “credible” death threats that have undermined peace efforts, UN-appointed independent rights experts said on Wednesday. 

In an alert, the Commission on Human Rights in South Sudan alleged that “overzealous” security forces had prevented dissent so dramatically, that civic space was now eroding “at an accelerating pace”, forcing rights defenders to flee and discouraging others from taking their place. 

“The State’s targeting of high-profile human rights defenders will have a chilling effect on civil society and will discourage public participation and corrode confidence in the important processes of transitional justice, constitution making and national elections, which are essential for the success of the transition envisaged by the 2018 Revitalised Peace Agreement,” said Commissioner Andrew Clapham.  

Communication breakdown 

The actions of the National Security Services (NSS) have included detentions, raids, a likely internet shutdown and an enhanced security presence on the streets of Juba, the panel said in a statement. 

Those targeted by threats, harassment and intimidation have included prominent human rights defenders, journalists and civil society actors. Many have played a key role in the country’s peace and justice processes. 

“Jame David Kolok and Michael Wani are among those now sheltering outside the country in fear for their lives,” the UN Commission said, in reference to Mr. Kolok’s membership of the Technical Committee to Conduct Consultative Process on Truth, Reconciliation and Healing – a position reaffirmed in May by the Ministry of Justice and Constitutional Affairs.  

Frozen out 

Mr. Wani had been a youth representative on the National Constitution Amendment Committee, according to the UN panel, which noted that both men’s bank accounts, “and those of the non-government organisations they lead, are among those recently blocked on government orders, with other civil society actors also affected”. 

The 2018 Revitalised Agreement for the Resolution of Conflict in South Sudan contains power-sharing arrangements between President Salva Kiir and opposition leader, Riek Machar.  

The accord requires the drafting of a permanent Constitution and the establishment of a Commission on Truth, Reconciliation, and Healing. 

Although implementation of these and other measures – such as public consultation requirements – have been slow, government leaders have renewed pledges and taken steps toward these in recent months, the UN Commission said. 

“These latest restrictions and acts of harassment follow the formation on 30 July of a new civil society coalition whose members planned a public assembly to take place on 30 August,” it explained.  

Clampdown in Juba 

The UN Commission – which was appointed by the Human Rights Council in March 2016 to investigate crimes linked to civil war that erupted in 2011 – noted that this public assembly could not take place amid “detentions, raiding of premises, an apparent internet shutdown, and an enhanced presence of security forces on the streets of Juba”.  

Numerous civil society leaders are still in detention and their wellbeing is unclear, the commissioners said. 

“The State’s authorities must respect and protect the rights of human rights defenders; this is an obligation under international law,” said Commissioner Barney Afako. “It would also demonstrate that South Sudan’s commitment to strengthening its systems for the consolidation of human rights is genuine.” 

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UN’s top envoy warns Great Lakes Region is ‘at a crossroads’

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Speaking at a Security Council meeting on the situation in Africa’s Great Lakes region on Wednesday, the Secretary-General’s Special Envoy, Huang Xia, told ambassadors that the countries concerned now stand “at a crossroads”.  

For Mr. Xia, the main threat to peace and stability in this region around the Great Rift Valley, remains the persistence of non-State armed groups. 

He pointed to “an upsurge in attacks”, whether by the Allied Democratic Forces (ADF) in eastern Democratic Republic of Congo (DRC), or those launched by the RED-Tabara against Bujumbura airport, in Burundi, last September. 

Since the beginning of this year, in DRC alone, at least 1,043 civilians have been killed, including 233 women and 52 children. 

“This violence continues to have serious consequences on the already fragile humanitarian situation, as well as on the socio-economic stability of the affected area”, the Special Envoy said.  

He told the Council Members that “these negative forces also remain involved in the illicit exploitation and trade in natural resources, the revenues of which finance their arms procurement and recruitment.” 

Solutions 

“How to put an end to it?”, he asked. “This is obviously an old question that haunts anyone interested in the region.” 

Despite the challenges, he highlighted several bilateral and regional initiatives, saying they “attest to the emergence of a community aware of the added value of dialogue and cooperation.” 

He also noted the overall peaceful transfers of power in the DRC and Burundi, as well as the signing and implementation of peace agreements in the Central African Republic, South Sudan and the Sudan.  

For him, more than ever, “it is necessary to sustainably consolidate these achievements while firmly addressing the challenges that persist.” 

“The success of such an approach requires learning from the lessons of the past and showing imagination to support the people of the Great Lakes region in building a better present and future”, he added. 

Turning to COVID-19, he said the pandemic has exacerbated vulnerabilities, but also demonstrated the resilience of the region.  

Before the pandemic, 15 million people across the Great Lakes were already displaced from their homes, facing rising malnutrition and food insecurity.  

Mr. Xia also reiterated the Secretary-General’s call for greater solidarity to facilitate access to vaccines and to strengthen health systems.  

According to the World Health Organization (WHO), to date, only 36 million doses of the vaccine have been administered in a region of nearly 450 million people. 

UN presence 

Martha Ama Akyaa Pobee, the Assistant Secretary-General for Africa in the Departments of Political and Peacebuilding Affairs and Peace Operations, also briefed Council Members. 

Ms. Pobee informed that the UN is reconfiguring its presence in the region to best address the challenges, highlighting a few areas where the Council’s support is most needed.   

For her, the situation requires “a comprehensive approach rooted in enhanced political engagement, encompassing military and non-military interventions, fostering economic cooperation across the borders and building trust between neighbours and among communities.” 

She also argued that “armed group activity is a symptom of insecurity in the region”, and therefore “the enabling conditions should be addressed upstream.” 

Among those main root causes, she pointed out the illegal exploitation and regional trafficking of natural resources, saying it contributes to the financing of armed group networks but also “creates parallel economy at the expense of States’ budgets whose revenues continue to diminish.” 

The Executive Secretary of the International Conference on the Great Lakes Region (ICGLR), João Caholo, and a civil society representative also briefed the Council. 

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African Union urged to address the threat of Congo forest logging driving extreme weather

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forest

Industrial logging in the Democratic Republic of Congo (DRC) may severely disturb rainfall patterns across sub-Saharan Africa and bring about more extreme weather, including intense droughts and flash floods. In a letter sent today to the African Union, Greenpeace Africa is calling for an urgent discussion of the consequences that plans made in Kinshasa to lift its moratorium on logging would have for Congolese and African people in general. 

Renewed industrial logging in the DRC poses a risk “to Indigenous People, local communities and biodiversity, as well as the whole of sub-Saharan Africa,” writes Greenpeace Africa’s Programme Director, Melita Steele, to the Commissioner for Rural Economy and Agriculture, H.E. Josefa Leonel Correia Sacko, 

Africa’s climate is fundamentally linked to the state of Central Africa’s forests and massive logging can impact the quantity of rainfall throughout the region. The Congo Basin forest is estimated to contribute more than half of the annual precipitation in Sub-Saharan Africa, already facing a plethora of droughts and extreme heat waves.

Last July, Congolese Deputy Prime Minister and Minister of Environment, Ève Bazaiba, decided to lift the moratorium on new logging concessions, which has been in place since 2002. The decision was approved on 9 July by the eleventh Council of Ministers, presided by Président Félix Tshisekedi. An implementation decree is believed to be imminent. 

“Deciding on whether to protect or destroy the rainforest may be within the DRC’s sovereignty, but the consequences of its actions will be felt everywhere from Nairobi to Dakar, from Pretoria to Abjua,” writes Steele on behalf of Greenpeace Africa. 

Beyond direct implications for Congolese and other African people, the decision to lift the moratorium is contradicting commitments made by the President of the Republic, Felix Tshisekedi, at President Joe Biden’s Leaders Summit on Climate, to protect the forest and increase forest cover by 8%. It also undermines the African Union’s 2063 Agenda and its Sustainable Forest Management Framework (SFMF), promising that “Africa will have zero deforestation and forest degradation and its forests will be protected, sustainably managed and restored through collaborative, cross-sectoral and transformative efforts to ensure the prosperity, food security and resilience of its people.” 

Finally, this jeopardizes Africa’s credibility in climate talks in COP26, set to begin in Glasgow in ten days, and the appeal from rich nations to support vulnerable nations annually with USD 100 billion to face the climate crisis. 

Serge Ngwato, Greenpeace Africa forest campaigner in Kinshasa: “We cannot expect Africa’s claim for climate funds to be taken seriously, when our own actions make the climate crisis worse. Renewing industrial logging would pose additional risk both to us Congolese and to our neighbours – the moratorium must be extended, while management rights over the forest must be granted to its Indigenous and local communities.” 

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