China’s experience can empower Africa
Resurgence of poverty in the continent highlights need for support to promote economic recovery
As the continent with the most developing countries, Africa, especially sub-Saharan Africa, has an average poverty rate of 41 percent, the highest in the world. COVID-19 has had a detrimental impact on the economic and social development of African countries, making poverty reduction harder.
While figures from the World Bank show that the number of people living in extreme poverty was reduced from 1.9 billion in 1990 to 689 million in 2017, the number is expected to see a sharp rebound this year, the first rise in three decades, as COVID-19 pushes more than 100 million people around the world back into poverty.
As for Africa, 25 consecutive years of positive growth, which has been the most critical dynamic to poverty reduction across the continent, will be ended by anticipated negative growth of from -2.1 percent to -5.1 percent in 2020, dropping per capita GDP to the level of 2010. The economic recession has pushed around 40 million Africans back into extreme poverty, according to African Development Bank, increasing the poverty rate by between 6 percent and 9 percent, which nearly offsets the poverty reduction achievement of the continent over the past decade. The rapidly worsening poverty crisis directly originates from challenges in three aspects.
First, massive job losses. The economic downturn has deprived many African people of work, notably in tourism, hospitality and retailing. In Kenya, 1.7 million employees in cities such as Nairobi and Mombasa lost jobs, increasing the country’s unemployment rate to 10.4 percent. South Africa predicts that 1.8 million jobs could be lost, mainly in cities such as Johannesburg and Cape Town, while unemployment might surge to 50 percent in the worst-case scenario.
Second, food security. Due to the outbreak, the Food Price Index of the Food and Agricultural Organization shows that global food prices, led by surging cereal and wheat prices, have been rising rapidly since February. African countries must resort to domestic agricultural production to fill the gap made by expensive food imports.
Third, inelastic supply chains. As most African countries have yet to cross the threshold of industrialization and are at the periphery of interconnected global supply chains, African peoples’ daily necessities and medicines must be satisfied mainly through international supplies. Considering COVID-19 has resulted in unprecedented disruption to the world economy, and the linkages between Africa and the international market are strained by restrictions or suspensions of international cargo transportation, African people, especially consumers in small and landlocked countries, have to spend more time and money for basic items.
The resurgence of poverty in Africa highlights the need for a strengthened povertyreduction approach in its recovery plans and international cooperation. China has always been committed to engage with African poverty reduction by sharing the dividends of its development and the public goods of a big responsible nation. Despite COVID-19, China has continued to make every effort to eradicate poverty, and is on course to eradicate absolute poverty in the country this year. This achievement should inspire Africa and provide Chinese solutions and wisdom for Africa’s poverty-reduction efforts, and the two sides should explore feasible ways to strengthen their partnership and cooperation. A self-sustaining driving force for development in Africa should be further consolidated. China’s experience shows how stable economic growth is the guarantee for poverty reduction, proven in the correlation between the economic downturn and rising poverty in Africa.
To put an end to overdependence on the world market and the imbalance between rapid populationurbanization growth and limited bearing capacity of economic development, China should continue to focus on helping African countries with their infrastructure construction, industrialization and agricultural modernization, support African countries and subregional organizations prioritizing domestic economic circulation through the building of a broader domestic market and a diversified economic structure, in order to provide fundamental solutions to poverty triggers such as unemployment, natural catastrophes and diseases and establish a more solid and resilient foundation for Africa’s economic development.
Specialized public institutions for poverty reduction should be widely launched in Africa. China’s success is closely linked with the major role played by leading groups or departments at all levels, which through a combination of government guidance and market regulation, mobilize government and society to provide targeted approaches to eradicate poverty.
The author is deputy director of the Security Studies Division at the China-Africa Institute. The author contributed this article to China Watch, a think tank powered by China Daily. The views do not necessarily reflect those of China Daily.