Africa does not need a “Marshall Plan” to ride out the ongoing Covid-19 crisis, instead it has a more powerful tool in the African Continental Free Trade Area (AfCFTA), which can be used to accelerate regional and economic integration and prepare for uncertain times, says Economic Commission for Africa (ECA) executive secretary Vera Songwe.
The Marshall Plan was a US initiative passed in 1948 to provide aid to Western Europe following the devastation of World War II.
Songwe believes integration is key for Africa’s future growth and its attainment of goals contained in United Nations' Agenda 2030 for sustainable development, as well as for meeting Africa’s development aspirations as set out in Agenda 2063.
The ECA estimates that economic growth in Africa this year will contract from 3.2% to 2.8%, owing to Covid-19. This is expected to result in 20-million people falling below the poverty line on a continent where 300-million people already cannot afford one meal a day.
Songwe further states that it is crucial for Africa to integrate its financial systems to create a mutualised system of financial stability that works for the continent, or regional monetary cooperation, such as in East Africa.
She adds that the African Export-Import Bank Exchange Facility is an excellent step in the right direction, but says more is needed to integrate economies and financial sectors.
“So we do not need to go the long distance of a common currency to get a mutualised system of financial stability that works for the continent.
"We need to ensure that, as we build the AfCFTA and trade integration, we begin to build stronger, much more robust monetary and fiscal systems that can ensure that as a continent we actually can work with each other in a more effective way.”
Meanwhile, the ECA is of view that Covid-19 has given Africa an opportunity to assess its weak health delivery systems with countries like South Africa, Ethiopia, Morocco and others building new health infrastructure.
Africa must produce internally, says Songwe. The continent imports $14.7-billion worth of pharmaceuticals a year, which is more than 95% of its demand.
Countries such as Egypt, Kenya, South Africa, Ethiopia and Cameroon, however, have the ability to produce pharmaceuticals for the continent.
“The crisis is a great opportunity the continent should not waste, in particular using lessons learned to enhance Africa’s industrial development; produce its own drugs and save billions of dollars in the process; promote digital inclusion; and work closer together than ever as one united Africa, with the private sector too,” Songwe concludes.