Monday, 11 May 2020

Zimbabwe has begun printing new notes in $10 and $20 denominations at a time when annual inflation stands at 926%, according to a state media report.

Citing Reserve Bank of Zimbabwe (RBZ) monetary policy committee member Eddie Cross, the Sunday Mail report said the decision was “imminent” to increase liquidity in the market.

“The plans are advanced and higher denomination notes will be made available to the public sometime later this month. The Reserve Bank will make the announcement. They are being printed and the appropriate date will be announced soon,” Cross said.

He added: “We are moving cautiously because we don’t want to disturb the monetary balance and we are insisting that banks pay for the currency when they draw it so that there is no money creation.”

The RBZ, like most of Zimbabwe’s public institutions, is faced with a bad transparency reputation. The first hint that the bank was already printing money was revealed in a social media video that went viral last week.

In the video a man suspected to be in his 20s is seen showing off bundles of packaged bank notes that have not been distributed. In a statement the bank said it was investigating the matter.

“The bank is offering a financial reward to the first person who will provide information leading to the positive identification and location of the man in the video,” the RBZ said.

Last week, finance minister Mthuli Ncube hinted that government would be forced to print more money to raise the ZW$18bn bailout for industry because of the economic paralysis caused by the Covid-19 lockdown.

In April, Harare wrote to international finance institutions for a bailout, but nothing came out of it.

Only last week Zimbabwe was assured it would receive a US$7m World Bank bailout to fight the Covid-19 pandemic, despite being in arrears with the Washington-based lender.

However, the US said there was need to carefully trace how the money would be used in Zimbabwe considering that there are high levels of corruption in handling public funds.

US chairman of the Senate foreign relations committee Senator Jim Risch said: “The US$7m World Bank grant for Zimbabwe reported today should come with strict transparency and accountability measures to ensure Zimbabweans receive services and support during Covid-19 and that these funds aren’t lost to ongoing mismanagement by the Zimbabwean government.”

Meanwhile, Mozambique received US$309m and Kenya got US$739m from the same fund.

 

Credit: New Zimbabwe

Published in Bank & Finance

Tesla CEO Elon Musk said on Twitter Saturday that the company is preparing to file a lawsuit against Alameda County and will move its headquarters and future operations out of California. 

On Friday, Alameda County’s interim public health officer, Dr. Erica Pan, said that health orders to contain a Covid-19 outbreak in the region are still in place, and that Tesla does not have a “green light,” to resume vehicle production at its main U.S. car plant in Fremont, California, yet. She also noted, “We have been working with them, looking at some of their safety plans, and have had some recommendations.”

Tesla had wanted to start production again on Friday afternoon. The plant is where the company makes vehicles for Europe and North America.  The company’s headquarters are in Palo Alto, not part of Alameda County.

Unlike other automakers, Tesla’s employees are not part of a union, so it would be easier for the company to significantly alter its operations. 

Insulting Pan personally, Musk wrote on Twitter:

“Tesla is filing a lawsuit against Alameda County immediately. The unelected & ignorant ‘Interim Health Officer’ of Alameda is acting contrary to the Governor, the President, our Constitutional freedoms & just plain common sense!”

He also claimed that: “Tesla knows far more about what needs to be done to be safe through our Tesla China factory experience than an (unelected) interim junior official in Alameda County.” 

  • Elon Musk tweeted on Saturday that he is going to sue Alameda County and move future operations out of California after a dispute over whether the company can reopen its factory there.
  • Musk has been clashing with regulators over local shelter-in-place orders meant to slow the spread of Covid-19.
 

Alameda County responded with a statement saying its Health Care Services Agency and Public Health Department have been working closely with Tesla in Fremont on a safety plan. They said they aim for Tesla to reopen while protecting the health of thousands of employees who travel to and from work at the factory.

“We look forward to coming to an agreement on an appropriate safety plan very soon,” the county said without offering specific details on a timeline. “We appreciate that our residents and businesses have made tremendous sacrifices and that together we have been able to save lives and protect community health in our region. We need to continue to work together so those sacrifices don’t go to waste and that we maintain our gains.”

While Musk characterized Pan as “ignorant,” the doctor has deep experience in both public health and infectious diseases.

Among other things, Pan is a graduate of Tufts medical school, completed a residency and fellowship at UCSF and has worked at Alameda County Public Health Department since 2011 while also working as a physician and professor. She previously worked for six years as the Director of Bioterrorism and Infectious Disease Emergencies at San Francisco Public Health Department, according to her resume on LinkedIn.

Previously, the Tesla and SpaceX CEO cursed and called Covid-19 health orders “fascist,” on a Tesla earnings call. He also erroneously stated that children are “essentially immune” to Covid-19, among other controversial tweets about the novel coronavirus and governments’ efforts to deal with the pandemic. 

Musk, who has a following of more than 33 million on Twitter, also encouraged shareholders to file a class action lawsuit against the county.

After the provocative string of tweets from Musk on Saturday, Fremont Mayor Lily Mei said in a statement:  “As the local shelter-in-place order continues without provisions for major manufacturing activity, such as Tesla, to resume, I am growing concerned about the potential implications for our regional economy.” She also expressed support for Tesla specifically, and urged the county authorities to “come up with acceptable guidelines,” to help Tesla and others reopen their businesses.

One Fremont based Tesla employee told CNBC workers there don’t know how to feel about Musk’s tweets on Saturday. This person, who asked to remain un-named as they did not have permission to give media interviews, said many Tesla employees would prefer that the CEO would just work with the county, make sure the factory is safe, and reopen as quickly as possible. 

Tesla did not reply to a request for further information about its plans to move headquarters out of the state, as Musk said they intend to do.

The SEC previously sued Tesla and Musk after the CEO tweeted that he would take the company private at $420 per share, and had funding secured. The agency said those tweets violated securities laws. As part of the eventual settlement between them, Musk agreed to have his Tesla communications reviewed by in-house counsel or some other so-called Twitter-sitter. It was not clear whether his Saturday tweets were approved by such a point person at Tesla.

Tesla shares have been on a run in 2020 and are up more than 95% for the year. 

 

Credit: CNBC

Published in World

As countries begin to reopen after months of coronavirus lockdown, Rwanda is pressing on with its May coffee harvest.

Rwanda, which supplied 21,000 tons of coffee to the global market in 2019, is about the world’s 30th top coffee supplier. It is known, proudly, for the quality of its beans, not the quantity.

After two decades of targeted investment by industry leaders, Rwandan coffee – once sold primarily in supermarket blends – is now available at Starbucks and upscale cafes alike.

But with coffee shops closing worldwide, the coronavirus crisis is testing Rwanda’s top export.

COVID-19 and coffee in Rwanda

Rwanda appears to have been successful in keeping COVID-19 at bay so far. The Central African country of 12 million reported just over 250 cases as of early May.

In March the government locked down the capital of Kigali, halted commercial flights and banned domestic travel for all nonessential workers. Coffee production, which provides an income to 350,000 Rwandan farming families, has been allowed to continue – in modified fashion.

To analyze the effects of COVID-19 restrictions on Rwanda’s coffee industry, we drew on information from our five-year research project funded by the U.S. Agency for International Development and interviewed local collaborators and international industry experts.

As a critical sector of the Rwandan economy, coffee is a sensitive topic in the country, so our contacts in Rwanda preferred to speak anonymously. The quotes included here are drawn from our interview notes and their accuracy checked with our sources.

Our analysis finds that health restrictions are increasing coffee production costs in Rwanda and introducing delays to the global supply chain that consumers halfway across the world may eventually feel.

Rwandan coffee, unripe on the tree in February, is harvested in April and May. Edwin Remsberg/VWPics/Universal Images Group via Getty Images

Open but restricted

Rwandan coffee farmers must adhere to social distancing guidelines during the May harvest, keeping coffee pickers one meter apart. As a result, according to two Rwandan coffee sector experts who work with farmers, they are hiring fewer workers. That may increase the time it takes to pick the same acreage.

Since not all workers in the coffee sector are considered essential, Rwanda’s strict travel restrictions are also slowing coffee’s journey from farm to cup.

“I cannot even legally drive out to our roastery, even though it is just a few kilometers away,” the manager of one Rwandan coffee roasting facility told us.

To avoid contact between buyers and farmers, some processing mills – which prepare fresh coffee beans, or “cherries,” for export and roasting by removing the skin and pulp – are asking farmers to deliver their harvest themselves, rather than send trucks for pickup.

Few farmers in Rwanda own cars or motorcycles – less than 3%, based on our research. So they must deliver their coffee on foot, traveling on average 3.5 miles. A round trip that normally takes minutes may now take two hours.

Once the coffee reaches the mill, hurdles to processing arise.

“My company has two agents who are allowed to travel to mills to oversee operations, but they must be tested for COVID-19” at police checkpoints when entering a new district, a Rwandan coffee buyer told us.

Sorting and milling of coffee is also likely to take substantially longer due to decreased staffing in compliance with social distancing regulations.

To keep on-site workers safe, mills are setting up hand washing stations and distributing hand sanitizer, but many are struggling to get required protective equipment like face masks, which have surged in price due to increased demand.

Vista of Rwandan coffee country. Andrew Gerard, CC BY

Global production disruptions

Sucafina, a multinational coffee trading company, reports similar supply chain disruptions in coffee-producing countries worldwide.

Colombia, the top supplier of coffee to the U.S., is under a strict national quarantine. There, coffee farmers report difficulty picking, packaging, delivering and selling their harvest.

“We are preventing the economic activity that can reactivate the economy of coffee-producing regions,” warned Roberto Vélez Vallejo of Colombia’s National Federation of Coffee Growers – which sells coffee under the brand Juan Valdez – via Tweet.

To overcome such challenges, Rwanda’s coffee farmers are turning to mobile technology.

Despite pervasive poverty, many Rwandan coffee farmers own mobile phones, and the country has worked hard to build a robust mobile network even in rural areas. That’s a critical resource right now, since the Rwandan government has mandated that payments between coffee mills and farmers be cashless.

Rwandan coffee farmers are also benefiting from being highly organized. The country has many agricultural cooperatives, which in normal times meet in person, provide direct services and help farmers negotiate collectively with buyers.

Now, co-op leaders are using text messaging to share information about coffee prices, social distancing protocols and other coronavirus-related topics with members.

Shifting demand

Neither technology nor unions can solve what is perhaps the biggest problem facing Rwandan coffee’s industry: a global coffee market in upheaval.

Across the United States and Europe – which together import over 60% of the world’s coffee – COVID-19 containment measures have shut down cafes, shifting where demand is located.

Thump Cafe in Denver, Colorado, serves single-origin Rwandan espresso. Aaron Ontiveroz/The Denver Post via Getty Images

In the U.S., which has a US$47.5 billion coffee shop industry, about a quarter of coffee consumption normally takes place away from home. Recently, this figure has come close to zero.

To serve coffee drinkers stuck at home, roasters must pivot to online and grocery sales – a difficult transition, especially for small players competing with chains like Starbucks.

International uncertainty is trickling down to Rwandan farmers in the form of broken contracts. One major Rwandan coffee exporter told us several buyers had either reduced or delayed finalizing their planned purchases.

Ruth Church, of the U.S.-based Artisan Coffee Importers, which specializes in Rwandan coffee, said she worried her clients would reduce orders too, but has since gotten confirmation that they will maintain last year’s purchasing levels.

“That comes from the relationship they’ve been able to form with the farmer,” she said of her buyers. “They know producers are vulnerable.”

But, Church warned, “Others may be forced to cancel or reduce.”

Rwandan coffee is adapting to get coffee to market. Now they hope someone will buy it.

Bridget Vuguziga, an independent consultant based in Kigali, Rwanda, contributed to this analysis.

[You’re smart and curious about the world. So are The Conversation’s authors and editors. You can get our highlights each weekend.]The Conversation

Andrew Gerard, Research Assistant, Department of Community Sustainability, Michigan State University and David L. Ortega, Associate Professor of Food and Agricultural Economics, Michigan State University

This article is republished from The Conversation under a Creative Commons license. Read the original article.

Published in Agriculture

“We know how to bring the economy back to life. What we don’t know is how to bring the dead back to life.” – Nana Akufo Addo, president of Ghana

The total number of deaths in the coronavirus pandemic has passed the 250,000 mark. The health and economic calamity continues to evolve rapidly; the world is scrambling to understand it.

Even as there are signs that the curve is flattening in the U.S., scene of one-third of the world’s fatalities, estimates of how many will die have doubled from 60 to 120,000. Italy and Spain, two of the worst hit countries in Europe, have peaked.

California, the largest state in America, has flattened the curve, joining Asian nations such as South Korea, Taiwan, Japan and, of course, China. Europeans and North Americans are starting to emerge from lockdown. New Zealand claims to have totally eliminated community transmission of coronavirus.

But the virus is continuing to take its toll. The United Kingdom has passed the 20,000 death mark; Russia, which appeared initially to have escaped the worst, is battling with an outbreak that led President Vladimir Putin to declare that “we don’t have much to brag about.”

New infections and deaths are on the rise in Brazil and Ecuador, giving rise to fears that the third wave of the coronavirus will be experienced in the developing world.

Despite dire forecasts, Africa has so far experienced only a fraction of the number of cases seen elsewhere.

By late April, the known infections worldwide was 3.4 million and the number of deaths about 240,000. Africa had only 45,000 reported cases, with 1,800 deaths – less than one per cent of the total in both categories.

Though it is too early to claim anything conclusive, fears of a tsunami of cases in Africa have not been lost yet.

In a continent as large as Africa with 54 countries, it is hard to pinpoint what explains this. One possibility is that, other than South Africa and Ghana, there has been less testing. This is suggested by the fact that Africa’s morbidity rate – the number of people who die after contracting the virus – is around 5 per cent, compared to a world average of less than two per cent.

South Africa – with 90 deaths and about 5,000 cases – has a case fatality rate (CFR) of about 1.8 per cent, somewhat less than the rest of the region but close to the global average.

The global CFR could in reality be much lower, as it is believed that many more people have been infected than tested positive. This is certainly the case in the U.S. where, as more testing has been carried out, the CFR has decreased.

Further complicating the picture are suggestions based on data from New York, Italy, the U.K. and Spain that the actual number of deaths from COVID-19 is at least twice the official number. People who die at home or in nursing homes before they are tested are not counted.

Curve flattens in South Africa’s powerhouses

While the number of positive cases in South Africa has risen along with more testing, it is still not increasing at anywhere near the level of the worst hit regions.

Relatively speaking, South Africa has contained the spread since the first cases were brought in on a flight from Italy in early March.

The South African response was decisive and carefully thought out and much credit goes to President Cyril Ramaphosa and Health Minister Zweli Mkhize in the way they have led the response and mobilised the country.

Because of our history with the HIV/AIDS crisis, the country has some of the best infectious disease experts and epidemiologists in the world, exemplified by the husband and wife team of Salim Abdool Karim and Qarraisha Abdool Karim.
South Africa was also willing to learn from what worked in other countries such as South Korea and China.

Most experts agree that the lockdown has limited the spread of the virus, reducing infection rates and delaying the onset of the peak and buying us time.

But there is no cause for complacency. Professor Salim Karim has warned that preventing exponential spread in South Africa is very, very unlikely.

Professor Shabir Madhi, of Wits University, who is heading the public health subcommittee advising the president, estimates that up to 45,000 South Africans could die from COVID-19. That means the worst is yet to come.

Nigeria, with a long experience of dealing with infectious diseases – and a history of containing Ebola during the 2014 epidemic – has also flattened out the number of positive cases, although new cases continue to rise.

Still, there is growing concern out of the most populous State, Kano, where a number of elderly people, including some of the State’s most prominent citizens, have died in recent weeks. These deaths have been attributed to other causes but with the negligible amount of testing, we are unable to know for sure.

But while the continent’s two biggest economic powers are not typical, it is striking how uniform the African numbers are. No African country has yet been affected anywhere close to the scale of the worst affected countries.

The African Exception?

From the beginning, there have been warnings that Africa, with its dense urban slums, large numbers of people with chronic illnesses, and inadequate public health systems could be facing a catastrophe.

But this has so far proven not to be the case.

In response, there have been suggestions on social media that people are resistant to the disease by virtue of being black.
The U.S. is, sadly, proving the opposite. African-Americans are dying at alarmingly higher rates than other population groups.

In Chicago, about 70 per cent of deaths are black, while the city is only 30 per cent black. In Milwaukee in Wisconsin, where only 26 per cent are black, 73 per cent of those dying are black. In the nation’s capital, Washington DC, it is 44 per cent and 72 per cent.

Eugene Scott, in the Washington Post, puts this down to four factors that are specific to African-Americans: higher rates of underlying health conditions and less access to health care; blacks holding a lot of the “essential” jobs that make social distancing difficult; insufficient information from the government reaching the black community; and racial disparities in housing.

All of these factors are prevalent to an equal or even greater degree in South Africa, where housing for the majority of the population and the access to health care is often worse.

Unlike the Great Recession of a decade ago, all the major economies will be struggling or crashing at the same time. Kristalina Georgieva, IMF managing director, said 170 of its 189 member countries will suffer falling output in 2020. “The bleak outlook applies to advanced and developing economies alike. This crisis knows no boundaries. Everybody hurts”…


What is extraordinary is how much we still don’t know about the silent killer that the New York Times this week described as capricious: “The question of why the virus has overwhelmed some places and left others relatively untouched is a puzzle that has spawned numerous theories and speculations but no definitive answers.”

What seems to be the case is that Africa was the last continent to be affected because of proportionately fewer air links with the rest of the world. By moving to lockdown early on, many African authorities have slowed the spread of the virus in the general population, but we have to contend with the reality that the constrictions on economic activity cannot be sustained.

The Africa Centres for Disease Control has warned that it is too early to draw any firm conclusion, but there are a few clues as to what is going on in Africa.

Africa benefits from having a youthful population.

A Lancet Infectious Diseases paper found that globally, the case fatality rate for those under the age of 60 is 1.4 per cent. For those over the age of 60, the fatality rate jumps to 4.5 per cent. For those 80 and over, COVID-19 appears to have a 13.4 per cent fatality rate.

The global CFR among those under 20 is 0.2 per cent.

Africa has a median age of 19.4, against 40 in Europe. Of the continent’s 1.2 billion people, only about 50 million are over 60.

Africa might have benefited from being in the tropics and from the fact that the virus first struck during summer in the Southern Hemisphere.

Research from Johns Hopkins University in Baltimore indicates that higher temperatures and humidity are correlated with a lower rate of coronavirus spread, similar to the correlation between climate and the influenza virus.

This is confirmed by researchers from Spain and Finland, who found that 95 per cent of positive cases occurred at temperatures between -2 and 10 °C.

Researchers from Beihang University in China, found that in the early days of the outbreak, hot and humid cities saw a slower rate of spread than cold and dry ones.

If this is valid, this is an ominous sign for South Africa, as it heads into the winter months.

Several recent studies have suggested a link between the BCG (the Bacillus Calmette-Guerin) vaccine – which was developed to fight tuberculosis – and the rate of death from COVID-19.

Tuberculosis is caused by a type of bacteria, while COVID-19 is caused by a virus. But the BCG vaccine might help people build immune responses to things other than tuberculosis.

Medical researchers in the U.S. and U.K. concluded by analysing data from 178 countries that those countries that do not have a BCG vaccination policy saw ten times greater incidence of and mortality from COVID-19, compared with those that do. Some of the worst hit countries such as the U.S., Spain and Italy do not administer BCG.

Almost all African countries administer BCG, though some only began doing so in the 1990s.

This link has not been scientifically established, but clinical trials are now being held to determine whether those nations that make BCG vaccination mandatory at birth are less susceptible to high COVID-19 related deaths. If this could be conclusively shown, it would be a massive breakthrough.

A World On Life Support

The path of the coronavirus and response to the pandemic has devastated the global economy. The Financial Times describes it as the worst collapse since the Second World War, and the most difficult moment for the global economy in almost a century.

The International Monetary Fund (IMF) expects the global economy to shrink by 3 per cent this year. This is far worse than its 0.1 per cent dip in the Great Recession year of 2009.

The lockdowns, business shutdowns and travel restrictions are destroying demand, at the same time as a financial crisis is unfolding.

In a worst case scenario, the world is heading into a global Great Depression.

Unlike the Great Recession of a decade ago, all the major economies will be struggling or crashing at the same time. Kristalina Georgieva, IMF managing director, said 170 of its 189 member countries will suffer falling output in 2020. “The bleak outlook applies to advanced and developing economies alike. This crisis knows no boundaries. Everybody hurts,” she said.

The IMF predicts that worldwide trade will plummet by 11 per cent this year. Global manufacturing supply chains are being broken.

During the Great Recession, China continued to grow at 9 per cent. Although it is reopening its economy ahead of the rest of the world, China’s GDP plunged by 5.8 per cent in the first quarter of this year, dipping into recession for the first time in 44 years. Meanwhile, the country remains on guard against a second wave of infection.

The U.S. economy is at a standstill and economists are projecting unemployment to reach 20 per cent in the second quarter. The IMF expects the U.S. economy to contract by 5.9 per cent this year.

Most of Europe is on lockdown and Germany, France and the U.K. are in deep recession. The Eurozone will suffer a 7.5 per cent drop and Japan, 5.2 per cent. U.K. output could dip by 6.5 per cent this year.

Emerging markets and low-income nations across Africa, Latin America and much of Asia are at especially high risk.

On a more positive note, the recent monetary and fiscal policy responses from across the world have generated some optimism for a rebound.

The world is desperate for good news, but there will be no end to the pandemic and return to pre-crisis behaviour until a vaccine is developed, which could be well into 2021. The impact of the coronavirus is likely to be prolonged and the peaks could be followed by more peaks.


The IMF forecasts that there will be 5.8 per cent global growth in 2021, but this is at best a thumb-suck because there is still so much uncertainty.

Governments in the developed world have been willing to make massive interventions to stimulate demand and interventions by central banks to ensure liquidity by keeping the cost of borrowing low and financing credit supply.

The U.S. enacted three aid packages worth $2.7 trillion. The Federal Reserve has enacted a $2.3 trillion rescue package for the economy. But at least 32 million Americans have lost their jobs and there is more pain to come.

And President Donald Trump’s erratic moves could jeopardise a U.S. recovery, even as the rest of the world struggles to get back on its feet.

African Economies In Pain

Even though Africa is the continent least scarred by the health crisis, it could end up the most damaged by the economic calamity.

Emerging market assets have been precipitously dumped and there has been capital flight worse than during the Great Recession.

Commodity prices that have buoyed African economies for the last quarter century have collapsed. Major mining operations have been mothballed.

Nigeria, Africa’s largest economy, has been driven into deep recession by the oil price crash – and is expected to contract by up to 7 per cent this year. Angola has been battered as well.

The tourism industry, a key part of the economies of countries such as Kenya, Botswana, Tanzania, Namibia and South Africa, has shut down.

Remittances from diaspora communities have declined dramatically.

There has been a huge fall-off of trade with partners such as China, Europe and the U.S.

The World Bank predicts that growth in Africa could fall to between minus 2.1 per cent and minus 5.1 per cent, led by severe downturns in Nigeria, Angola and South Africa.

Africa’s domestic economies have had a stranglehold placed on them where countries have implemented social distancing measures, closed borders and imposed lockdowns.

The majority of Africans work and trade in informal markets, meaning that millions are now unable to work.

The African Union estimates that up to 20 million workers could lose their jobs. Even in developed countries, workers are just one pay-cheque away from being completely broke. The scale and impact in human terms are unimaginable.

People have no money to spend, further collapsing demand. There are signs of widespread hunger and the World Bank is warning of a food security crisis. Social and political unrest will surely follow.

And this is before the full health impact is felt.

The World Bank, IMF and African Development Bank have announced billions of dollars in emergency credit facilities to African countries and called for bilateral debt relief. But that will not be enough.

Kristalina Georgieva, managing director of the IMF, estimates that emerging countries may need as much as $2.5 trillion in support. African leaders are calling for, at the very least, a debt standstill.

The needs are insatiable – scaling up the health sector response, maintaining wage payments amidst a massive wave of firm bankruptcies, relieving social distress and growing hunger and poverty, all while protecting the overall stability of the financial system.

President Ramaphosa’s R500 billion social and economic package is intended to go some way towards alleviating the worst of the crisis in the short term but much will depend on its execution and the fiscal sustainability of the programme. Given the experience of the past decade, can we expect those implementing the programme to ensure that this massive pot of money will find its way to the intended recipients?

The early signs are not encouraging.

In order to pay for it, Ramaphosa has indicated that he will use whatever is available to prop up the economy and prevent social collapse, including IMF loans, but at some point the bill will come due.

Other African countries do not have our options. They are being called upon to drain their treasuries to provide support for the poor and unemployed and to bolster their health systems, just as tax revenues have literally collapsed. Ken Ofori-Atta, the Ghanaian Finance minister, says he is green with envy at the “unthinkable stimulus packages” being announced by the developed nations.

“Their generous tool kits are not available to us,” he laments.

Living With a Pandemic

There is great uncertainty about the speed of the recovery, largely because it depends on the continued path of the virus – and medical advancements that have not yet happened.

The world is desperate for good news, but there will be no end to the pandemic and return to pre-crisis behaviour until a vaccine is developed, which could be well into 2021. The impact of the coronavirus is likely to be prolonged and the peaks could be followed by more peaks.

With so much at stake, there is an unprecedented global race underway to produce a vaccine, with seven clinical trials underway, and a group from Oxford University providing the most optimistic timeline of about six months.

For Africa, the main lesson is, in the words of Ken Ofori-Atta, that it is time to challenge the unbalanced nature of the global architecture. Which means, perhaps, that the point is not to replace one overlord with another but to imagine a world order in which we all have a place at the table…


The ability of the virus to mutate and to come back, maybe in a more virulent form, is why the Asian nations emerging at the other end of the first wave are not dropping their guard.

The lockdown strategy has been implemented to flatten the curve – to prevent the pandemic occurring in a compressed time frame – and buy time to prepare health facilities for a spike in cases.

In the absence of a vaccine, therapies of existing drugs are being used for COVID-19 patients. But while studies are being fast-tracked around the world, they are not yet conclusive. The drug, remdesivir, originally developed to treat Ebola, is said to be showing some promising early results but other therapies such as the much touted hydroxychloroquine are still viewed with skepticism and only used to treat the most severe cases.

In the absence of a vaccine, attempts to move countries out of lockdown – which are now underway – have to be strategic, phased, targeted and managed on a long-term basis – and accompanied by widespread testing and surveillance and proper equipment for health care providers. Countries could also go back into lockdown if there are further spikes.

There will be no way forward without knowing where the enemy is – tracking the virus and isolating it. South Africa has one of the world’s most innovative programmes, sending 28,000 health workers into communities for screening and testing.

Some of what we know about catastrophic viral pandemics is drawn from the experience of the 1918 Spanish flu which killed between 50 million and 100 million people.

The flu came in three waves. The first relatively mild version was in March 1918 and it appeared to have run its course by the northern summer. The second more virulent and infectious version struck in September 1918 and the third continued through 1919.

The second wave came to South Africa via two troopships of soldiers who were returning from the Western front and stopped in Freetown en route, where the flu was raging. When they docked in Cape Town, they were quarantined, but not effectively, and set off a wave of infections that ended with the deaths of about 300,000 people – six per cent of the population of the country at the time.

Epidemiologists have puzzled over why the diamond miners in Kimberley, almost a quarter of whom died in the flu, died at 35 times the rate of the gold miners in Witwatersrand.

It is now believed that the miners on the Reef had already developed some immunity from the first strain that had traveled up from Durban earlier in the year. The more isolated Kimberley miners only experienced the second, more lethal wave.

The End of Globalisation?

In seeking to find a culprit for the pandemic, we do not need to look too far: the globalised economy, the era of free and easy travel and movement between countries spread the virus. Globalisation made the globe more vulnerable to a pandemic.
The upside of globalisation – the free movement of capital and ideas and the free trade that has driven the global economy since 1945 – is presently being reassessed in a harsher light. Some assume that the age of globalisation is now over.

French President Emmanuel Macron sees the crisis as an “existential event for humanity” that will change the nature of globalisation and the structure of international capitalism.

Is it likely that nation states will turn themselves into fortresses surrounded by moats to keep out aliens and foreigners? Depending on the devastation to economies and the forces of populist nationalism that will be unleashed by the pandemic, that could well be the outcome.

But it would hard to see recovery in such a world. It was a global trade war in the 1930s – spurred on by the U.S. Congress’ Smoot-Hawley Tariff Act – that was one of the major drivers of the Great Depression and helped set the stage for the Second World War.

The stronger argument is that the moment demands greater community between nations in fighting a common enemy. What the coronavirus has taught us is that the existential threats of the 21st Century, from the pandemic to climate change, are ones that threaten us all.

The very qualities required to defeat this virus – scientific knowhow, capable and responsible government, global solidarity, basic humanity – are what we need for survival and prosperity in the years ahead.

These are the very elements that are threatened that at this moment.

However, instead of co-ordinated policy responses from governments around the world, we see a fracturing of international co-operation.

We should not forget what the last quarter century of turbo-charged globalisation has brought us. It has lifted billions of people out of extreme poverty, not just in India and China, but in many other nations, and in large parts of Africa as well.
However, as the gap closed between the developed and the developing world, it brought stagnation and job losses to the middle and working classes of the U.S. and Europe, and widened inequality between a global super-class with unimaginable wealth and just about everybody else.

It also gave us the pandemic which, if nothing else, is a moment to reflect and reset.

One reason for pessimism is that the U.S., which was the prime mover and leader of the post-1945 world, has been missing in action.

Trump has steered the U.S. away from any constructive international role. He has rejected calls to create a global taskforce to deal with the pandemic and threatened to cut funding to the World Health Organisation in the middle of the worst health crisis in a century. While his administration’s incompetence at home has cost many lives, its reputation abroad has been badly tarnished.

Trump has dashed hopes that the world’s two leading economic powers will co-operate. He has indicated that he wants to run for re-election on a China-baiting platform, exacerbating the ill feeling that has been generated by the last three years of trade wars.

With the U.S. abdicating, many people are finding it hard to imagine a globalised world without a hegemon, which is why many believe China will takes the U.S.’ place in a new global order. Xi Jinping has, for the last three years, already emerged as the most outspoken champion of globalisation.

But to be the leader of a free world, one must also possess the magic ingredient of soft power, which presupposes an admiration for one’s system of governance. China, with the recent experience of the Hong Kong protests and the many thousands of Muslim Uighars still in detention, not to mention its initial lack of transparency around the outbreak of the coronavirus, might not be best placed to lead the new world order.

There’s also a lot of anger towards China right now. Oby Ezekwesili, Nigeria’s former minister of Education and a former vice president of the World Bank, has argued that China should pay compensation to Africa for failing to transparently and effectively manage the global catastrophe.

For Africa, the main lesson is, in the words of Ken Ofori-Atta, that it is time to challenge the unbalanced nature of the global architecture. Which means, perhaps, that the point is not to replace one overlord with another but to imagine a world order in which we all have a place at the table, and in which the two greatest powers find it in themselves to work together, and with the rest of us, for a common humanity.

If there’s any upside to the unprecedented uncertainty gripping the world right now, its that the economic fallout has opened up a new debate about the right sort of policies to have. Its time to think creatively about what we can do and where we want to take this country, this continent and this planet. Its time for new thinking, imagination and boldness.

 

Mcebisi Jonas is the chairman of MTN and former deputy Mminister of Finance in South Africa.

Published in Opinion & Analysis

Google and Facebook have told most employees to keep working from home for the rest of the year as part of a response by the tech giants to the deadly coronavirus pandemic.

Chief executive Sundar Pichai told Google staff at an all-hands meeting that its remote work policy will be extended until 2021, the Silicon Valley giant confirmed Friday.

Any return to offices was expected to be incremental and staggered, according to the company.

The news came along with US media reports that Facebook is also letting workers tend to their jobs remotely for the rest of this year.

Google employees who need to return to offices will be able to do that in the next month or two, with added safety measures in place due to coronavirus concerns, but most of the staff will continue working from home.

Facebook’s updated plan is to re-open offices in early July, but let people work from home if they prefer until 2021, according to reports.

 

AFP

Published in Telecoms
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