ADDIS ABEBA – Adequate consideration of the vulnerability of city economies needed as African governments consolidate efforts to mitigate coronavirus’s economic impact at national and regional levels, according to UN Economic Commission for Africa.
“As engines and drivers of economic growth, cities face considerable risks in light of COVID-19 with implications for the continent’s resilience to the pandemic,” states Thokozile Ruzvidzo Director of the Gender, Poverty and Social Policy Division of ECA.
Africa’s cities are home to 600 million people and account for more than 50% of the region’s GDP.
This is even higher at more than 70% for countries such as Botswana, Uganda, Tunisia, and Kenya.
A third of national GPD (31%) comes on average from the largest city in African countries.
As such, the economic contribution of cities in the region is far higher than their share of the population, says ECA in its analysis to inform COVID-19 policy responses.
COVID-19 employment effects are likely to be severe in urban areas.
ECA’s analysis claims “with urban-based sectors of the economy including manufacturing and services which currently account for 64% of GDP in Africa are expected to be hit hard by COVID-19 related effects, leading to substantial losses in productive jobs”.
The vulnerability is even higher in the approximately 250 million Africans in informal urban employment excluding North Africa, according to ECA.
Further, with the per capita expenditure of African local authorities being the lowest in the world at $26, the UN agency says many local authorities are poorly resourced and less able to contend with the onslaught of COVID-19.
Yet, local authorities are frontline responders to such shocks and crises.
Given the proximity to their constituencies, the economic commission claims “local authorities are well-positioned to and already do lead responses to some of the immediate effects, and doing so have a better understanding of needs and necessary measures, and enable higher transparency of accountability”.
It also says proactive measures are needed for urban economic recovery through measures to boost finances and capacities of local authorities as first responders, short term bailouts and exemptions for SMEs to limit productivity and employment loses, social protection for those in informal urban employment while anticipating the potential of labor-intensive public work programs for job creation in the medium term.
In this regard, Ruzvidzo emphasizes that “local governments must be supported because they are better able to respond to local needs including in coordination with community-based structures”.
Image: The skyline of Addis Ababa [Photo File/Alamy]