The economic life of African cities is in danger

The United Nations Economic Commission for Africa (ECA) warned on Tuesday that African cities could suffer a sharp decline in their productivity, employment and income if the COVID-19 pandemic develops.

“As engines and drivers of economic growth, cities face significant risks, with implications for the continent’s resilience in the face of the pandemic,” said Tokuzel Roosevelt, Director of Gender, Poverty and Social Policy at CEPA.

The population of African cities is 600 million, which is more than 50 percent of the region’s GDP, and more than 70 percent in countries such as Botswana, Kenya, Tunisia and Uganda. On average, a third of each country’s GDP comes from its largest city.

The economic contribution of the region’s cities is much greater than their share of the population, and it will continue to grow because it is estimated that within 15 years more than half of Africans will live in cities.

The effects of COVID-19 on employment can be severe, whether in formal jobs in manufacturing and services or in informal urban jobs, which employ 250 million people in sub-Saharan Africa.

CEPA believes that businesses and companies in cities are highly vulnerable to the impacts of the pandemic, particularly small and medium-sized enterprises, which provide 80 percent of jobs in Africa.

Urban consumption and spending (of food, manufactured goods, utilities, transportation, energy and services) is likely to decline sharply due to restrictions associated with covid-19, and there are already reports of food prices rising 100 percent in some African countries. Cities.

Roosevels noted that African cities “drive consumption with a growing middle class, with average per capita spending in large cities 80 percent above the national average.”

He added that the epidemic-related decline “will have an impact on local value chains and will reach rural areas.”

Moreover, the per capita spending by local authorities in African cities, $ 26 annually, is the lowest in the world. Their average income from sources is 10 percent and will decline as activities close, so they will depend on transfers from national forces, which the pandemic has already so severely demanded.

African finance ministers have asked the international community for an aid package of at least $ 100 billion, including $ 44 billion for debt deferment, to address the impact of COVID-19 on health and basic economic activities.

CEPA has proposed providing specific support to municipal governments to mitigate and respond to the economic impacts of COVID-19, in addition to an immediate humanitarian and health approach, particularly addressing employment and productivity in small businesses and public works.

Many cities suffer from rapid population growth, poor public infrastructure, poor healthcare services, and high vulnerability to disasters.

“City governments must be supported because they can better respond to local needs, even in coordination with community structures,” Roosevels said.

In the long term, CEPA insisted that efforts are required to revitalize and improve the productivity of cities, with sufficient investments to address the current shortages, including the need for better urban planning, so that millions of its new residents are less vulnerable.

AE / HM