Beyond the Pandemic: Transformative Recovery
As COVID-19 continues to take a fierce toll on Southern Africa—the countries and their supporters like Shared
Interest are asking: How to “build back better?” Beyond relief and reconstruction, how to address systemic weaknesses that leave the region’s people and economies most vulnerable to poverty, inequality and climate change?
In this context, Shared Interest is focusing its efforts on climate, food security, small and social enterprise development, and women-led strategies that promote economic, racial, gender and environmental justice.
As policies and resources are put in place, the process has already begun. In South Africa, on October 15, President Ramaphosa informed the National Assembly of “extraordinary measures we must take to restore our economy to inclusive growth following the devastation caused by COVID-19 to our people’s lives and our country’s economy.” Having initially focused on emergency health and relief measures valued at R500B (about 10 percent of the country’s Gross Domestic Product), the President launched South Africa’s Reconstruction and Recovery Plan.
The plan outlines programs to support and create 800,000 jobs, including massive infrastructure development and energy generation—more than half of it from renewable sources. It also emphasizes support for small and growing businesses essential to sustaining township and rural communities and boosting Black ownership and livelihoods in an economy in which wealth and economic power remain highly concentrated in larger industries and white-owned enterprises.
Shared Interest’s loan guarantees to agricultural cooperatives in the Western Cape and a transportation cooperative in KwaZulu-Natal, as well as guarantees for traditional community projects in the Eastern Cape, have focused on creating livelihoods and building wealth through shared ownership. We have also supported businesses whose products and services particularly benefit low-income communities of color, including a woman-owned feminine hygiene company now distributing its product in township markets. We look forward to deepening our work with social enterprises that serve impoverished communities, create jobs, and transfer increasing wealth from white to Black and, where possible, women’s hands.
In neighboring Mozambique – still recovering from two of history’s worst cyclones and floods—COVID-19 has dealt a severe economic blow, sinking official 2020 growth forecasts from 4.3 percent before the pandemic to -0.4 percent now. On October 23, the World Bank announced a $100M grant for Mozambique’s COVID-19 response program to finance for small and growing businesses as well as financial institutions that lend to them. Ten days later, the European Union pledged an additional $116M to Mozambique to help overcome the socio-economic consequences of the pandemic and set the country’s economy on a more productive and sustainable path.
With Shared Interest’s recent work in the country focusing on food production and small business distribution of agricultural inputs, our guarantees during the coming period can continue to complement enhanced government programs by unlocking local bank credit for small and growing businesses to produce and deliver more food—addressing the challenge of hunger.
Malawi is hit equally hard, with recent assessments projecting that its economy will lose more than $6B over the next 30 years. Highly exposed to droughts and floods, and suffering from accelerating deforestation, its most vulnerable sectors include agriculture, food services, and related industries and manufacturing, with small and growing businesses particularly hamstrung by limited access to capital.
In response, the Malawian government has developed an Integrated National Financing Framework to anchor its COVID-19 response and recovery campaign, encouraging both private and public funding. As Shared Interest mobilizes finance and capacity building for organizations like African Women in Agribusiness (AWAB) and enterprises such as LenzieMill, it helps fuel Malawi’s transformative agenda by moving commercial lenders to build women’s economic power to address the country’s food security and climate change priorities.
In closing his report to South Africa’s National Assembly, President Ramaphosa’s words resonated regionally: “Our ability to reignite our economy rests on the decisions we take in this crisis…We shall not rest until we have built a new economy based on fairness, justice and equality. This is the task of our generation: to renew, to repair to rebuild…The time is now.