NigeriaInvestmentInvestments in West Africa in the Midst of a Pandemic: Myth or Reality

Koko NkanorFebruary 4, 20233569 min

The year began on a high note and looked very bright. African Development Bank had predicted 3.9%  growth in 2020 and 4.1% growth in 2021. This was until the unprecedented emergence of the Coronavirus pandemic.

Less than two months later, United Nations Economic Commission for Africa (UNECA) altered Africa’s 2020 growth predictions and put it at less than 2 percent of the initial projections. Covid-19 was declared a pandemic by the World Health Organization (WHO) on 11th of March, 2020 and in April, The World Bank said that Africa is headed towards its first recession in 25 years.

The West African region has been terribly hit by this crisis. On Friday, 25th July, 2020, The Board of Directors of the African Development Fund (ADF) approved a $69 million grant to support Ghana’s efforts in tackling the pandemic and alleviating the socio-economic effects on the nation. The International Monetary Fund (IMF) in April approved $3.4 billion in emergency support to Nigeria and in June, African Development Bank (ADB) approved $288.5 million loan for Nigeria to tackle Covid-19. Togo also received an immediate disbursement of $131.3 million dollars from the IMF.

The distressing projections and figures are mostly as a result of hard hits to the oil and gas and tourism sector which serve as a major source of revenue for the region and the apparent collapse of the value chain system.

There is, however, a need to ascertain the viability of these opportunities. Are they short term and likely to fizzle out at the end of the pandemic or are they long term? Are they a flash in the pan of opportunities or ones that shall stand the test of time? These and more are some of the issues to be addressed before taking a leap.

The usual traditional classroom learning has been put on hold since the emergence of this pandemic and there has been an upward, constant increase in e-learning. There have been several, innovative e-learning solutions that have been developed. In Tanzania, Ubongo recently launched Ubongo Toolkits, an online library platform of varying educational resources and African-made early learning materials for children between the ages of 0-14.

This is an area for possible investments as educational institutions across West Africa and globally would require e-learning solutions so their annual syllabus is not totally disrupted by the current pause in the traditional classroom methods as a result of the pandemic and risks involved in such gatherings.

Digital payments have become more popular as a result of the global lockdown and fears of contracting the virus when involved in physical, financial transactions. Prior to Covid-19, Fintech was the apex for venture capital investment in Africa. New methods of online payments, lending and investments have been introduced through tech-based solutions. The current presence of the pandemic has increased the trend of digital financial management and it is as sector that hasn’t been fully harnessed.

According to CNN business, Zoom’s revenue skyrocketed to 169% from the prior year to $328 million for three months ending in April as it became the most used video conferencing service for a vast majority of people during the lockdown.

Microsoft Teams communication has seen as huge boost to Microsoft as there has been a great rise in remote working, remote meetings and video conferencing. There has been a boom in digital media and telecoms as a result of the social distancing requirements. There is a growing need to match consumer needs as the world is rapidly becoming more digital and significantly so, since the onset of this pandemic.

Zipline, a drone-delivery service has been delivering medical supplies to remote areas in Ghana and Rwanda. Supplies like masks and Covid-19 test kits have been delivered to distant locations. West Africa has been characterised by fragile health-care systems with a limited number of hospitals, medical equipment and a lack of adequate workforce. Technological advancements in this sector can aid in addressing a major percentage of the loopholes currently present and bring about great advancement. Creative, technological solutions are vital to transforming the health sector across West Africa. There have been a few of such solutions emerge like Zipline but there is still room for much more to be done.

One cannot fully determine what will generate huge returns on investment, the investment tenure, investment portfolio or levels in returns. The pandemic has presented huge investments in technology because of the current, rapidly growing digital trend and high demand for it. Investors interested in this area are likely to thrive in it.

Koko Nkanor

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