Comparative study of policy responses to COVID-19 in LICs in Africa
Date
2023
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Abstract
This brief assesses the policy responses to COVID-19 among low-income countries (LICs) in Africa. While LICs have adopted expansionary fiscal and monetary policies in the face of economic lockdown, as well as other mitigation strategies, the scale and quality of such responses have been modest compared with those of emerging and middle-income countries. Policy instruments have also varied across countries, in line with the level of development of domestic financial markets and the extent of digital inclusion. Pre-pandemic economic challenges, such as limited fiscal space, high debt levels and inflation, have also contributed to countries’ weak economic responses. External financing has been crucial for LICs’ ability to respond to the pandemic, but is still inadequate given the huge financial gap that exists. As LICs move from the relief to the recovery phase of COVID-19 economic management, a rethinking of economic responses is crucial both to bring about a swift recovery and to minimize the catastrophic impact of COVID-19 on recent developmental gains.
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Policy Brief
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Keywords
COVID-19 RESPONSE, CENTRAL BANKS, MACROECONOMIC POLICY, MONETARY POLICY, SOUTH OF SAHARA