- 05 / 04 : AfCFTA must go ahead say African business leaders
- 05 / 01 : Air deliveries to Africa ramped up with dispatch from UN’s cargo hub in Belgium
- 05 / 01 : Rwanda eases one of Africa’s toughest lockdowns
- 05 / 01 : IMF approves $411m in emergency assistance to Ethiopia to address COVID-19
- 05 / 01 : UN chief laments a divided international community in the face of COVID-19
Movers & Shakers
Mauritius declared wary victory over Covid-19, saying on May 12 it had “zero” active patients and had not documented a single new case in 17 days. The Indian Ocean island nation is the first African country to announce such a feat, though the island remains wary of new infections.
Kenya’s biggest bank by assets, KCB Group, posted 8% profit after tax in the first quarter to March at $59m. However, the lender has had to restructure more than $1bn in loans and the CEO is hesitant to predict how earnings will be impacted this year.
Jumia, a major e-commerce platform in Africa, has reported an almost 7% fall in first quarter revenue due to supply chain disruptions, particularly in China. It also reported signs that lockdowns were hastening a shift towards online shopping in Africa.
Kenya and Zambia have closed their borders with Tanzania, following growing fears that the government has failed to get a handle on Covid-19. The government has not announced any updates since April 29, leading to a warning from the US Embassy that the pandemic has grown exponentially in Dar es Salaam.
The eastern-based Libya National Army (LNA) has suffered a series of military setbacks since Turkey sided with the Triopli-based UN-backed government in January. The Government of National Accord (GNA) captured the LNA’s only airbase near Tripoli, as Libya’s ongoing civil war draws in more foreign powers.
Mozambique’s long-awaited LNG project, which could transform the country into a leading gas producer, has been delayed by COVID-19 and other financing issues, says Ed Hobey-Hamsher, senior Africa analyst at global risk consultancy Verisk Maplecroft.
“It makes it increasingly likely that Rovuma LNG, the operator of the long-awaited offshore gas project Area 4, will reach a final investment decision in the first half of 2021,” he writes in an exclusive op-ed for African Business.
The 14-day quarantine for all new arrivals and restrictions on internal movement will pose practical challenges for its project partners. A fledgling LNG sector and shallow labour market mean Area 4 is very dependent on the expertise and skills of international staff.
Senior managers will struggle to access the project site and executives won’t be able to meet government officials and their national oil company, Empresa Nacional de Hidrocarbonetos (ENH), counterparts in Maputo. Both are necessary measures to pave the way to the final investment decision.
However, COVID-19 related restrictions in Mozambique may be the least of Rovuma LNG’s problems, he adds.
In fact, financing will play a bigger role in pushing back the final investment decision into 2021. COVID-19 has reduced global demand for gas and depressed LNG prices.
Additionally, indirect stakeholder ExxonMobil withdrew an application for $2bn of funding from EXIM Bank, the US export credit agency. This followed EXIM Bank’s unfavourable view of the participation of the Chinese state-owned China National Petroleum Corporation.
“Therefore, we see H1-2021 as a more feasible timeframe for the Area 4 partners to reach final investment decision,” he says.
Read the full post here.
Uganda will begin the phased lifting of its lockdown at the end of the current period of restrictions on May 5.
In a meeting chaired by President Yoweri Museveni on Tuesday, the cabinet agreed that each sector of government will develop a plan for the phased reopening of the country.
President Museveni tasked the ministers to present the sector plans at a special cabinet meeting on May 2 which will review them and decide on the phased implementation when the current lockdown ends on May 5.
In an effort to tackle the spread of the coronavirus into the country from neighbouring states, the ministers reportedly agreed that each truck will be allowed to have only a driver and he or she will be tested at the border before entering the country.
Nearly all the new cases of COVID-19 cases in the last two weeks have been cargo truck drivers bringing in essential commodities from Kenya and Tanzania.
The IMF approved US$3.4bn in emergency financial assistance under the Rapid Financing Instrument to support the authorities’ efforts in addressing the severe economic impact of the COVID-19 shock and the sharp fall in oil prices.
The COVID-19 outbreak has magnified existing vulnerabilities, leading to a historic contraction in real GDP growth and to large external and fiscal financing needs.
Once the impact of the COVID-19 shock passes, the authorities’ commitment to medium-term macroeconomic stability remains crucial to support the recovery and ensure debt remains sustainable.
The near-term economic impact of COVID-19 is expected to be severe, while already high downside risks have increased.
Even before the COVID-19 outbreak, Nigeria’s economy was facing headwinds from rising external vulnerabilities and falling per capita GDP levels
. The pandemic—along with the sharp fall in oil prices—has magnified the vulnerabilities, leading to a historic decline in growth and large financing needs.
Sudan could be plunged back into political instability and conflict if it is not offered sufficient financial support to deal with the economic fallout of the coronavirus pandemic, according to the UN High Commissioner for Human Rights.
Michelle Bachelet said that the country, which is undergoing a fragile transition to civilian rule after the 2019 overthrow of dictator Omar al-Bashir, could face ‘untold suffering’ amid acute resource constraints on the transitional government and decrepit health infrastructure.
“The health system is simply not equipped to handle an outbreak on the scale we have seen elsewhere in the world. There is only one way to prevent a humanitarian disaster, and that is for the donors to step up and extend a helping hand to Sudan,” said Bachelet.
Financial constraints are exacerbated by the effects of ongoing sanctions, the failure of international institutions to provide debt relief, and a deficit of international support, said Bachelet.
Sudan remains on a US list of states sponsoring terrorism and is not among the countries eligible to access a $50bn established by the International Monetary Fund to assist countries fighting COVID-19.
“We must act swiftly and generously to provide financial support. Otherwise, we run the risk of a country which held such promise relapsing back into political instability and potential conflict,” said Bachelet.
“The only way Sudan will ever be able to break out of this cycle of poverty and desperation is to be freed from the impediments of sanctions imposed at the time of the previous government. This would enable Sudan to attract investment for its much-needed economic reforms, and to fully access funds of the international financial institutions.”
275 people in Sudan have tested positive for COVID-19 of whom 22 have died.
Secretary of State Mike Pompeo said that the United States has committed over $170m to the fight against COVID-19 in Africa and would consider further debt relief for the continent.
Speaking on a phone call to journalists, Pompeo said that the Africa support comprised part of $775m that the country has spent abroad during the pandemic and insisted that “no other nation is doing more than we are”.
“In Ghana, Senegal, Uganda, Sierra Leone, Mauritania, we repurposed field hospitals, tents and ambulances from international peacekeeping missions for COVID-19 efforts. In Ethiopia, the state department, led by USAID, has trained more than 500 COVID-19 rapid-response workers. In Nigeria, for example, even in states ravaged by Boko Haram and Isis in West Africa, the state department and USAID have trained hundreds of volunteers to help slow the spread of the virus.”
Pompeo said that the US was constantly evaluating “the how and when” of further debt relief for African countries following an initial commitment from the G20 to suspend debt service payments for the world’s poorest countries until the end of the year, comparing US efforts with those of adversity China.
“I welcome this critical financial support that’s been provided to low-income African countries and debt suspension, both on a bilateral basis and debt from the G20 and Paris Club members. …I would also remind everyone that there’s an enormous amount of debt that the Chinese communist party has imposed on African countries all across the region,” he said.
He also hit back at suggestions that US withdrawal of funding for the WHO amid a fallout over its COVID-19 response negatively impacted its African partners.
“We’re not reducing the amount of money that we’re providing for global health assistance. Indeed, far from it. I’m confident we will actually increase that number. But we need to make sure it’s part of a multi-national institution that functions, that can actually deliver good outcomes for the people in some of the poorest countries in the world that are there in Africa.”
Burundi announced yesterday it has opened election campaigns for a national vote scheduled for May 20.
The election will take place following confirmation on March 31 of the country’s first COVID-19 cases. The president’s spokesperson said on April 7, in reference to the pandemic, that elections will go ahead because “[Burundians] are a people blessed by God.”
Health authorities have blocked journalists from accessing a Covid-19 press conference, which could indicate government attempts to suppress information about the pandemic.
Violence and repression have been the hallmark of politics in Burundi since 2015, and as elections approach and the Covid-19 pandemic unfolds, tensions are rising,” said Lewis Mudge, Central Africa director at Human Rights Watch.
“There is little doubt that these elections will be accompanied by more abuses, as Burundian officials and members of the Imbonerakure are using violence with near-total impunity to allow the ruling party to entrench its hold on power.”
Since President Pierre Nkurunziza’s decision to run for a controversial third term triggered a serious human rights crisis five years ago, confirming details of abuse has become increasingly difficult, as fear has engulfed the country and the authorities have intensified efforts to silence the media and activists, Human Rights Watch said.
On April 11, two Health Ministry officials blocked four journalists from attending a COVID-19 news conference in Bujumbura. “They told us we are enemies of the nation, and that we are not allowed to go in,” one journalist told Human Rights Watch.
World risks up to 1 billion cases and 3.2 million deaths from COVID-19 across fragile countries, says International Rescue Committee
New analysis by the International Rescue Committee (IRC) reveals that without swift action in coming weeks to mitigate the spread of COVID-19, the world could see up to 1bn infections and 3.2m deaths over the course of the pandemic in 34 crisis-affected countries including warzones like Afghanistan, Syria, and Yemen.
David Miliband, President and CEO of the International Rescue Committee, said: “These numbers should serve as a wake-up call: the full, devastating and disproportionate weight of this pandemic has yet to be felt in the world’s most fragile and war-torn countries. We are still in the critical window of time to mount a robust preventative response to the early stages of COVID-19 in many of these countries and prevent a further perpetuation of this epidemic globally.”
Preliminary estimates compiled by IRC are based on epidemiological modelling and data produced by Imperial College London (ICL) and the World Health Organization (WHO). This model takes into account the age structure, household size, and social contact patterns of different countries, as well as mortality patterns from the early outbreak in China.
IRC’s calculations for the 34 countries in which we work highlight the extent of the burden on fragile countries of the COVID-19 outbreak, and the importance of immediate actions in the coming weeks to influence the trajectory of the epidemic.
Scientists are still studying the drivers of the pandemic in lower-income contexts, including factors such as population health risks which may drive infection rates up, or others such as younger population age structure which may drive mortality rates down; these figures are nevertheless sufficient to spark significant alarm on the international trajectory of COVID-19. However, three significant limitations of the current data suggest that estimates for fragile countries may be conservative at best:
1. Healthcare capacity and virus reproductive rate. The ICL/WHO model uses the best available mortality data, from China, which pre-supposes that levels of medical care available therein would be available elsewhere. As the IRC has previously warned, fragile states have nowhere near the healthcare capacity provided in China.
2. Pre-existing humanitarian vulnerability. These mortality figures do not account for excess deaths caused by underlying humanitarian vulnerability (including co-morbidity due to pre-existing health issues such as malnutrition) or by the economic and political instability which constitute a “double emergency” for fragile contexts. While strict lockdowns and social distancing will unquestionably save lives in wealthier nations, direct consequences such as market closures and income losses (without robust social safety nets) risk driving impoverishment, hunger, and domestic violence in humanitarian settings. Without sufficient social safety nets or relief packages in place to prevent people from spiraling further into poverty and hunger, these same measures risk harming populations already caught in weak states or unstable humanitarian contexts.
3. Disruptions to humanitarian aid delivery. Movement restrictions and disruptions to supply chains are already impacting the ability of agencies like the IRC to deliver life-saving humanitarian aid to people in need. South Sudan, a country with only 4 ventilators and 24 ICUs and where almost 65% of the population relies on humanitarian assistance, may for instance face famine with a toxic mix of restricted movement, economic instability, reduction in agricultural labor and pre-existing high levels of malnutrition and chronic food insecurity.
The double crisis of the COVID-19 pandemic and the collapse in oil prices is taking a toll on African economies and the African energy industry. Unstable and precarious oil prices have resulted in substantial cuts in state budgets and public spending, in losses of contracts and hundreds of thousands of jobs put at risk.
As bouncing back from this historic crisis will require strict and bold government action, the African Energy Chamber released on Sunday its Call to Action, detailing 10 measures that form a commonsense energy agenda for Africa.
The impacts of the current crisis are wide and affecting both Africa’s most promising exploration prospects, but also its multi-billion-dollar landmark projects such as BP and Kosmos Energy’s Greater Tortue Ahmeyim (GTA) LNG project in Mauritania and Senegal or ExxonMobil and Eni’s $30bn Rovuma LNG project in Mozambique.
Oil projects are suffering even more. In Ghana, the development of the Pecan Field has been thrown into very uncertain waters. Aker Energy cancelled its letter of intent sent to Yinson Holding this year to charter, operate and maintain the Pecan FPSO, set to be Ghana’s next big oil offshore development.
Woodside Energy’s Sangomar Offshore Oil Project, Senegal’s very first oil venture that was sanctioned early this year, will be facing financing delays. FID on Shell’s Bonga South West Aparo project in Nigeria, for which the invitation to tender was released to contractors early last year, could also not see FID this year.
Delays in the execution or sanctioning of these projects will severely impact African economies whose local goods and services were set to benefit from billions of dollars of subcontracting opportunities.
“Our commonsense approach advocates for measures that will support the continuity of business operations and future sector growth. The oil and gas industry will only work for Africans when we set fair policies and treat oil and gas companies as partners who drive our progress,” declared NJ Ayuk, Executive Chairman at the African Energy Chamber.
“As the voice of the energy industry, we will continue to work with the public and the private sector and other stakeholders to revitalize the African oil and sector by putting Africans back to work,” added Ayuk.
While the immediate impact on the continent’s biggest oil and gas project is already being felt, a much bigger one will result from the deferral or cancelling of drilling plans. Across oil and gas basins, drilling projects are being put back on the shelves or terminated.
It is the case of Valaris’ drilling activities for Chevron in Angola, of BW Energy’s drilling operations on the Marin Dussafu Permit in Gabon, of the much-awaited exploratory drilling by FAR in The Gambia, of early termination of drilling works of Maersk in Ghana’s Jubilee and TEN Fields, or of Tower Resources’ force majeure on the Thali PSC in Cameroon. No country is sparred, and such delays will further defer discoveries of new fields, and development drilling to ramp up Africa’s daily output.
Since the beginning of the COVID-19 pandemic and its subsequent effect on oil demand and prices, the African Energy Chamber has been leading the dialogue between the public and the private sector on advocating for measures to support our industry and its jobs.
While the Chamber believes that market forces need to determine the industry’s future and advocates for limited government across the industry, the time calls for urgent actions. We cannot let our companies and industry collapse for the fear of loosing jobs and investments that would sustain our economies for decades to come. It is worth bearing in mind, that activity in and income from Africa’s energy sector generates significant amount of demand and services from other non-oil and gas sectors of the economy.
Key measures released yesterday are the extension of PSCs and work program adjustments to boost exploration and ensure the resumption of drilling activities. The Chamber also strongly advocates for tax relief on services companies, reforms of upstream fiscal regimes, banking and financial support, regional content development, incentives to infrastructure projects, and bold actions on removing fuel subsidies.
More than 200 Cuban doctors arrived this morning in South Africa to help Africa’s most-affected country fight the COVID-19 outbreak.
The medics left on a plane that first carried a donation of South African medical supplies to the Caribbean island, its embassy in Pretoria said.
They are among 1,200 healthcare workers sent to battle COVID-19 in 22 countries that have requested help from the socialist state.
South Africa is to begin easing strict lockdown restrictions next month.
More than 1.5 million people will be allowed to return to work, some schools will reopen, deliveries of hot food will be permitted and cigarettes will be back on sale.
But the sale of alcohol and public gatherings will still be banned.
South Africa has almost one doctor for every 1,000 people, below the global average, according to World Bank data.
Kenya’s interventions on COVID-19 is bearing fruit after recovery of patients surpassed the 100 mark today.
Chief Administrative Secretary (CAS) for Health, Dr. Rashid Aman announced that in the last 24 hours, the Ministry of Health has discharged eight patients from hospitals bringing to 106 the total number of our recoveries.
“We have noted that the number of recoveries is steadily going up while fatalities have stagnated,” Dr. Rashid said while updating the media COVID-19 at Afya house.
He highlighted that in the last one week, the number of those who have died from COVID-19 has remained at 14 an indication of the dedicated healthcare workforce and announced that in the last 24 hours the ministry has sampled 500 cases out of which, twelve 12 new cases of coronavirus have been confirmed bringing the total to 355.
Eight of these cases are from Nairobi and four from Mombasa. All are Kenyans, aged between 14 and 60 years and three have a recent history of travel from Somali.
Data: Cédric Moro, I-Resilience
Updated 22 May
Top 5 confirmed cases by country