Earlier in the year, the world experienced an unprecedented event of COVID-19 outbreak with Africa not being an exception. The incidence of COVID-19 in Africa was followed by stringent measures across the region. Notably, all countries imposed some form of restrictions on the movements of people and economic activities.
These restrictions and lockdowns worsened the already fragile social and economic conditions of most countries within the region. As the continent continues to fight its way out of the damage caused by the pandemic, it must be noted that this has been followed by protests and one form of social unrest or other in various part the continent.
Certainly, this poses another threat to the economy of the region. Specifically, Nigeria, the largest economy on the continent is currently battling a protest against police brutality (#EndSARS). South Africa, the second-largest economy is also dealing with Gender-Based Violence (#StopGBV) across the countries.
Similar to the event in Nigeria, Zimbabwe (#ZimbabweanLivesMatter) has been protesting about the human right violation by the current government which has affected their freedom of speech. In Congo, #CongoIsBleeding has been trending on social media for days. Also, Cameroon’s #AnglophoneCrisis which has been on for a while resurfaced and have now escalated into a crisis over the economic and political marginalisation of Cameroon’s.
With the devastating impact of COVID-19 on the region, now amplified by social unrest, economic outcomes in the region may actually weaken beyond initial projections. Going forward, Africa may need additional SDR from the IMF and the World Bank to supplement foreign exchange reserves, better manage FX liquidity and restore output growth.
United Capital Research