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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

CAR: Displacement reaches 120,000 amid worsening election violence

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Poll workers carry ballot boxes during the 27 December 2020 presidential elections in the Central African Republic. MINUSCA/Leonel Grothe

“Worsening” election violence in the Central African Republic (CAR) has forced 120,000 people from their homes, the UN refugee agency, UNHCR, said on Friday. 

In an appeal for an immediate end to all bloodshed – which has included deadly clashes with UN peacekeepers – UNHCR also said that mass displacement has continued outside the country since the 27 December Presidential poll, reversing a trend of people returning to CAR in recent years. 

“What is clear is the situation has evolved, it has worsened, we have seen that the number of refugees has doubled in just one week”, said spokesperson Boris Cheshirkov, during a scheduled press briefing in Geneva. 

Despite attempts by rebel groups to obstruct presidential and legislative elections, on 27 December, nearly two million Central Africans successfully cast their votes. 

UNHCR and partners in CAR “are gathering reports of abuses by armed groups, including of sexual violence, attacks on voters and pillaging”, Mr. Cheshirkov continued, underscoring the agency’s call “for an immediate return of all parties to meaningful dialogue and progress towards peace”. 

“We were reporting 30,000 refugees last Friday, today it’s already 60,000, and much of that is the increase we’ve seen in the Democratic Republic of the Congo (DRC). This is coming with reports of intensified violence, people are being forced to move from their home and the situation has not calmed down for the moment.” 

‘Fear and dread’ 

Echoing concerns for the deteriorating situation, the UN-appointed independent rights expert for CAR called on Friday for the arrest and prosecution of all those “who continue to fuel violence” there. 

Because of them, the country’s people live in “fear and dread”, said Yao Agbetse, before deploring the fact that Central Africans “were unable to exercise their right to vote and that many were victims of torture or ill-treatment and death threats for exercising their right to vote in the first round of elections”.  

Calling out the so-called Coalition of Patriots for Change (CPC), Mr Agbetse alleged that the group  had “obstructed the country’s electoral campaign in December, prevented the deployment of election materials, disrupted the mobilisation of voters to carry out their democratic right and burned polling stations”. 

The CPC had also recruited children for its work, the rights expert maintained, “a crime under international law”. 

Several localities were targeted, including Kaga Bandoro, Bossangoa, Batangafo, Bozoum, Bocaranga, Koui, Carnot “and other locations in the centre, west, and east of the country”, along with the capital, Bangui on 13 January, said the rights expert, who reports to the UN Human Rights Council in Geneva.   

In his statement, Mr Agbetse noted that CAR’s “already fragile humanitarian situation” had worsened, with “more than half of the population in vital need of humanitarian assistance”.  

Prices soaring 

The premises of some humanitarian organisations had been ransacked, he added, while basic necessities “are becoming scarcer and their prices are soaring in Bangui because of insecurity on the supply routes to the capital”. 

Today, schools and training centres are closed outside the capital “and pastoralists and farmers can no longer carry out their activities because of insecurity and fear. Ultimately, food insecurity and extreme poverty are likely to worsen,” Mr. Agbetse said. 

10,000 cross in just 24 hours 

On Wednesday alone, 10,000 people crossed the Ubangui river that separates the two countries, UNHCR’s Mr. Cheshirkov said. 

He added that in addition to the 50,000 refugees in DRC, another 9,000 have reached Cameroon, Chad and the Republic of Congo in the past month. 

In an appeal for funds, the spokesperson said the inaccessible terrain and poor infrastructure along the Ubangui river where people have sheltered, has complicated aid access. 

“UNHCR was already seeking $151.5 million this year to respond to the CAR situation. The needs of the recently displaced Central Africans are mounting, and we will soon face a substantial funding shortfall,” Mr. Cheshirkov explained 

Inside the Central African Republic, another 58,000 people remain displaced.

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Africa Today

Ethiopia: Safe access and swift action needed for refugees in Tigray

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Ethiopian refugees fleeing clashes in the country's northern Tigray region, rest and cook meals near UNHCR's Hamdayet reception centre after crossing into Sudan. © UNHCR/Hazim Elhag

The head of the UN refugee agency (UNHCR) on Wednesday expressed his deep concern over the humanitarian situation in the Tigray region of Ethiopia, including its impact on Eritrean refugees hosted there. 

The conflict between the Ethiopian Government and regional forces of the Tigray People’s Liberation Front (TPLF) began in early November, when the Prime Minister ordered a military offensive after rebels attacked a federal army base. Government forces reported that the region had been secured at the end of November, but TPLF resistance has continued amid accusations of extrajudicial killings and rights abuses. 

Despite some positive developments in accessing and assisting vulnerable populations, since the start of the Government operation, UNHCR’s repeated requests to access the Shimelba and Hitsats refugee camps have gone unanswered. 

“I am very worried for the safety and well-being of Eritrean refugees in those camps”, said UN High Commissioner for Refugees Filippo Grandi. “They have been without any aid for many weeks”.  

UNHCR continues to receive many reliable reports and first-hand accounts of ongoing insecurity and allegations of grave and distressing human rights abuses, such as killings, targeted abductions and forced return of refugees to Eritrea, said Mr. Grandi. 

Moreover, the agency has learned of additional military incursions over the last 10 days that are consistent with open-source satellite imagery showing new fires and other fresh signs of destruction at the two camps.  

“These are concrete indications of major violations of international law”, the High Commissioner spelled out. 

Doubly distressed 

Ethiopia has long given refuge to people fleeing conflict and persecution.  

The federal Government has provided assurances of measures are to minimize the impact of the conflict on civilians.  

“I have impressed upon the Ethiopian leadership, the urgency of ensuring the protection of refugees, preventing forced return and keeping refugee camps safe from attacks and other threats from armed actors”, said Mr. Grandi.  

Equally distressing, he said, is that UNHCR teams have been unable to assist the thousands of Eritrean refugees who continue to flee the camps in search of safety and support.  

“Refugees arriving on foot to Shire town in Tigray are emaciated, begging for aid that is not available”, recounted the High Commissioner.  

Against the backdrop that refugees who had reached Addis Ababa are being returned to Tigray, some against their will, he reiterated the UN-wide call for “full and unimpeded access” to explore “all options to safely provide desperately needed assistance”. 

Unwavering commitment 

In line with the humanitarian principles of impartiality and neutrality, UNHCR stands committed to work with the Ethiopian Government in protecting and assisting those forced to flee.  

“We remain available to seek solutions – together – to the current humanitarian problems in a spirit of collaboration and constructive partnership”, said the UNHCR chief. “Safe access and swift action are needed now to save thousands of lives at risk”.

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Africa Today

Insecurity and bureaucracy hampering aid to Ethiopia’s Tigray region

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photo: UNFPA/Sufian Abdul-Mouty

Nearly three months after the start of conflict in Ethiopia’s Tigray region, hundreds of thousands of people have yet to receive assistance, the United Nations reported on Wednesday, citing information from its humanitarian coordination agency, OCHA.

“Humanitarian assistance continues to be constrained by the lack of full, and safe, unhindered access to Tigray, caused by both insecurity and bureaucratic delays”, UN Spokesperson Stéphane Dujarric told journalists

“The UN and its humanitarian partners in Ethiopia urgently call on all parties to allow the immediate safe passage of humanitarian personnel and their supplies to the Tigray Region to be able to reach all people who desperately need assistance.” 

Over two million in need 

Mr. Dujarric said the UN continues to receive alarming reports of civilians being injured and killed in rural areas in Tigray, as well as of violations against civilians, though verification remains a challenge.  

“Aid workers have been able to deliver assistance in some areas, mainly in cities, where access has been granted by the authorities. However, the number of people reached is extremely low compared to the 2.3 million people we estimate are in need of life-saving assistance”, he said. 

The situation is particularly critical for newly displaced people and refugees, especially those who were living in two camps that remain inaccessible, according to OCHA

Humanitarians further warn that the majority of the 270,000 people receiving benefits through the Government’s Safety Net Programme have also been without assistance as banks in most rural areas have been closed since before the crisis began. 

“These are extremely vulnerable people who rely on monthly cash transfers to meet their basic needs,” said Mr. Dujarric.

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