African countries that respond with innovative ways and make structural changes to their economies will recover fast, said global risk and strategic consulting firm Control Risks on Tuesday.
Barnaby Fletcher, associate director of Control Risks said this while launching the 2020 Africa Risk-Reward Index which examines the longer term implications of COVID-19 on Africa.
“The COVID-19 pandemic is a global crisis, but Africa’s recovery will be slower and more uneven than most. However, this recovery will be an opportunity for governments across the continent to address structural constraints and promote new solutions,” Fletcher said.
He called for African countries to diversify their economies.
Fletcher believed that Africa will experience its first recession in 25 years while the economic recovery will be driven by private sector.
Jacques Nel, head of Africa Macro at NKC African Economics, said individual countries’ response will also determine how they recover from the pandemic.
“The economic impact of COVID-19 will be varied but the recovery will be even more so. The optimists will hope to see a race to the top as governments undertake desperately needed reforms, while the pessimists will see a continent setback more than a decade,” said Nel.
He said South Africa will have to address the energy sector which is characterized by loadshedding.
South Africa has to restore business and consumer confidence and restructure the economy. He pointed out that the government will have to come up with a recovery plan and convince the private sector about their plan, he said.