By Antony Mutunga
To date the disruptions caused by COVID-19 are still being felt throughout the economy as many businesses struggle to stabilize and return operations to the norm. In fact, its impact led to Africa’s GDP to contract by an estimated 3.2 percent in 2020. This saw an estimated 55 million Africans pushed into extreme poverty as more than two decades of progress in poverty reduction was wiped out.
According to an Economic Report on Africa (ERA2021), ‘Addressing Poverty and Vulnerability in Africa during COVID-19’, an estimated 12.6 percent more people were expected to fall into poverty in 2020 alone – more than the total number of people pushed into poverty since 1999.
Usually, poor households move into and out of poverty because of exogenous shocks like the COVID-19 pandemic, and their inability to manage uninsured risks only increases their vulnerability. Therefore, non-poor people whose consumption lies between Sh221-Sh337 ($1.90–$2.09) a day are likely to fall into poverty due to the pandemic because even a small amount of consumption volatility can push them into poverty. Poor people, who own few assets, have limited access to credit, informal employment and low wages are particularly vulnerable and have been severely hit by pandemic-containment measures.
Current projections indicate the pandemic is likely to continue increasing the number of people living in extreme poverty, in Africa and globally.
Hanan Morsy, United Nations Economic Commission for Africa (ECA)’s Deputy Executive Secretary said the report analyses the implication of COVID-19 in terms of poverty, but brings a new dimension stressing the vulnerability in Africa. It brings the element of people centric analysis of what has been happening during COVID-19 and what we need to do to ensure that the vulnerable population are protected in terms of social safety net and putting up the right policies.
“This report is particularly relevant given to what we have seen as the implications on the continent. The most critical implication of COVID-19 has been the reversal of the very hard-won gains that the continent had managed to achieve in reducing poverty,” said Morsy.
To respond to the growing poverty effects of the pandemic, many African countries have executed expansionary fiscal and monetary policies to maintain consumption and aggregate demand and prevent firm closures and job losses. But with effects from other conflicts such as the Russia-Ukraine conflict this will be greatly affected in the long run and the number of those falling into extreme poverty will continue soaring.
The African Continental Free Trade Area (AfCFTA) has the opportunity to put Africa in a better position to eradicate poverty. Currently, most African countries still depend on exports of raw materials and on imports of essential goods such as food items and pharmaceuticals.
If AfCFTA is effectively implemented, intra-Africa trade is expected to increase, helping Africa industrialize and diversify, reducing trade dependence on international countries and boosting the share of intra-Africa trade from roughly 15 percent to over 26 percent. (
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