African businesses are shifting towards new technologies in response to the ongoing pandemic, according to a new report published by the United Nations Economic Commission for Africa (UNECA).
The UNECA and the International Economics Consulting Ltd jointly published the report which is the second comprehensive survey on the COVID-19 pandemic and its economic impact across Africa, according to UNECA.
The online survey was conducted from June 16 to July 20 to provide insights into the effects of the pandemic on economic activity for businesses across the region. The survey mainly identified challenges encountered by African businesses as well as their responses to mitigate the adverse impact of the pandemic.
According to the report from the survey among the top three challenges faced by African countries during the pandemic are reduced opportunities to meet new customers drop in demand for products and services, as well as lack of cash flow.
“Companies have faced serious disruptions in both supply and market due to COVID-19, with unfair pricing seen as a major concern,” the report read, while feedback from companies about government assistance “is mixed with nearly two-thirds of the respondents indicating from moderate to no satisfaction,” it said.
According to the report, “companies are currently working at about half their capacity” while company revenues are expected to drop by about 18 per cent in 2020 compared to 2019 while lay-offs are expected to increase by 20 per cent in the next three months.
On remote working, the report noted that the option proved more challenging for micro, small and medium enterprises (MSMEs), particularly those dealing with goods with there performance has been negatively affected compared to larger-sized companies.
According to the survey two-thirds of the surveyed companies indicated that they have identified new opportunities in response to the crisis.
The Economics Affairs Officer at the Regional Integration and Trade Division at the ECA, Simon Mevel, also stressed that firms involved in goods and MSMEs are displaying “the highest shares in terms of new opportunities identified following the crisis, which in turn is expected to be positive from a gender point of view as women are primarily engaged in MSMEs dealing with goods.”