Ebola: From human to economy killer

In the Chinese Province of Shandong, 22- year-old Flora Chen is sad; concerned about the raging Ebola virus that has forced her mother to cancel a planned holiday in East Africa. She [Flora’s mother] had intended to visit Kenya, Uganda and Rwanda using a single tourist visa, launched by the three countries. What began as a west African epidemic, killing hundreds of people in the few months it has lasted, has since ‘gone viral’ in the true sense of the word; advancing from being a furious human killer to a monstrous economic saboteur currently. During an interactive session with the regional business leaders at the sixth East African Business summit here in Kigali, President Paul Kagame and his Kenyan counterpart Uhuru Kenyatta were asked how the EAC economies are prepared to guard their economies against potential effects of Ebola. “Ebola reminds us of how inter-connected and inter-dependent our economies are and therefore requires concerted efforts to counter,” said Kagame. Kenyatta on the other hand said Ebola is no longer an African but rather a global problem whose negative effects are already being felt by the Kenyan economy. “We must be proactive. The Kenyan tourism sector is already taking in the effects as most tourists [from Europe and beyond] assume Ebola is everywhere in Africa,” Kenyatta noted. Since its outbreak in May, the plot of the Ebola story had mainly taken the angle of a health problem until recently, at the annual World Bank and IMF meetings in Washington when Finance Ministers from the affected countries in West Africa revealed how the epidemic has left their economies in ruins. The plot has since added an economic angle to the story. Now there’s panic in international boardrooms of the IMF, UN, the World Bank and others as efforts to put in place a contingency fund are being expedited. On Wednesday, EAC ministers of health met in Tanzania, trying to come up with a regional strategy aimed at guarding against such threats and contribute to emergency calls coming in from West Africa. But how much of a risk is Ebola to economies? Those who listened to Kaifala Marah, Sierra Leone Finance Minister got an idea just what Ebola could do to economies, especially those emerging from years of long conflict and only beginning to enjoy post-conflict progress. A frightening story it was; and still is. “Ebola has made me begin to appreciate and understand that fragility is self reinforcing. Because if we had had the right infrastructure, the right institutions, and the right human capacity to be able to confront Ebola, we wouldn’t have suffered as we have right now,” observed Marah. Do East African economies have those facilities in place that could stand in the face of an outbreak such as the one West African is experiencing? Like Rwanda, Sierra Leon is a country that only recently emerged out of political turmoil and had been enjoying fast growth until Ebola struck in May. The country was projecting a GDP growth of 11.3 per cent, but after two months of the epidemic, that was reduced to just 7 per cent and now in October, that figure has been further revised downwards. “Clear cut reality shows that that [GDP growth of 7 per cent] is impossible. So it’s now over around three to four percent and it could be worse soon,” he said during an African finance ministers’ press conference in Washington attended Henry Rotich, Kenya’s treasury secretary. Worse still, Ebola is scaring away foreign investment in West Africa and a capital flight is underway. This is one element governments can’t control as they can’t force investors to stay around, as they evacuate at the slightest threat to the health of their staff bringing operations to a grinding halt. During their brain-storming session with the business community, the Presidents of Kenyan and Rwanda agreed that while the West African experience provides lessons to learn from and increase preparedness. In Sierra Leon, everyone is running from Ebola; EAC leaders should be asking; how do we keep investors by our side during bad times like that? For instance, Sierra Leon’s manufacturing has been hurt by fleeing investors; the country’s equivalent of Bralirwa is set to lose 24,000 jobs which will affect at least 600 sorghum farmers; Cocoa and coffee which account for 90 percent of that country’s agro export is also at the bottom now and construction has collapsed as the contractors have abandoned their sites. London mining, one of Sierra Leon’s major iron ore companies literally closed down when the virus struck in a bid to protect their staff; according to the minister, just a handful of staff are remaining on ground. Pooling regional resources At a time when for instance RwandAir is plotting to spread out its wings far and wide, calamity elsewhere is calamity to those hopes. Because of Ebola, even incoming tourists from West Africa will be frowned upon—a point that President Kagame captured when he noted that Ebola has a multiplier negative effect that has potential to hurt everyone due to the inter-connectedness of the economies. As a solution, Kenyatta and Kagame noted that EAC governments need to work together to combat problems that confront them as a region. “A problem in Kenya will definitely affect all East Africans [including Rwandans].” Terrorism was placed in the same realm of Ebola, a category of problems with far reaching negative effects on the economy and according to Kagame, it’s important that EAC governments pool resources ready to intervene in case of an epidemic or an attack. If such a proposal was actualized, it would be a welcome addition to other efforts such as the UN’s Mission for Ebola Emergency Response.

Health

Ebola: From human to economy killer