DR Congo: Severe Economic Hardship Following The Covid-19 Pandemic, What Solutions?

By Badylon Kawanda Bakiman*

My business is suffering , says Jean-Marie Kosongiato

 Institutions, traders, families, individuals… so many social categories in the Democratic Republic of Congo (DRC) in Central Africa, continue to experience the negative economic impacts following the whips of the Covid-19 “pandemic”. Even if some categories find some avenues for solutions, the improvement of economic conditions in this country will still take time.

The store of the “Bikie ya Kie” establishment located in the ‘’Plateau’’ of Kikwit city, Kwilu province, in the south-west of the Democratic Republic of Congo (DRC) is still bankrupt and closed. There are no more sundries business despite the concerted efforts to get back on track. The lifting of the “State of health emergency” that the President of the Republic had made in August 2020 could allow this economic operator to revive, but in vain.

Jean-Marie Kosongiato, initiator of this store which employed seven people is still worried: “I lost a turnover of 9000 dollars. The situation is explained by the fact that the President of the Republic, during the state of health emergency which lasted six months because of coronavirus, had cut off the capital Kinshasa from the other provinces. No entry, no exit. This reality has put the activities on the ground”, he testifies.

He claims that the stocks were already finished and that the receipts were used more to solve certain social problems: to pay the arrears of wages of his four agents who had urgent family situations; pay the rent for the house where the store is housed etc.

“I am struggling to resume these activities. I don’t know when it will be effective,” he said.

In Kinshasa, the capital, mother Pauline Ebaka, 55, in the commune of N’djili, district 7, is among the licensed agents of “Kin Express”, one of the travel agencies that connects Kinshasa – Bandundu, Kinshasa – Kongo central.

She lost her three-year-old son last September: “I had no money to take him to the hospital. My son had a case of severe diarrhea. People I have approached to borrow money have not responded positively. Catering at the family level had become complicated,” she regrets.

In Kinshasa itself, the central government had lowered the budget for 2021 because of the effects of covid-19 on the country’s economy. This had gone from 11 billion in 2020 to 6.8 billion US dollars for 2021. In 2022 the country’s budget amounts to 11 billion dollars. Will it solve the economic problem?

In Mbuji-Mayi, Kasai Oriental province, central DRC, a divorce nearly took place between John Tshimanga and his wife in August 2020.

“My wife did not believe that I could run out of money. However, the trips I made to Kinshasa to get by were no longer taking place because of the state of health emergency and the exclusion of Kinshasa from the provinces,” he said.

The aforementioned facts are among many others. The different social categories in the DRC continue to experience the negative economic effects of the Covid-19 “pandemic” in a kind of immeasurable stoicism.

Situations in a crucial context

According to Jonas Kibala Kuma, a Congolese economist, “The standard of living of the population in the DRC is low compared to GDP (Gross Domestic Product) per capita, which has been low and declining since 1960. High poverty rates (63.4 %)”.

“To date, many industries are operating at 3/4 of their capacity. I’m worried, I don’t know what’s going on. The economy is at its worst. Many companies have laid off staff, they are struggling to turn. The banks have restructured 25% of their credit potential”, recognized, a few days ago, Kimona Bononge, managing director of the Federation of Congo Enterprises, the largest trade union of economic operators in the DRC on the antennas of Top Congo FM, one of the radios broadcasting in Kinshasa.

According to the World Bank, in Africa, the “pandemic” of Covid-19 is a crisis that comes on top of many other crises, including invasions of desert locusts, drought, climate change, fragility, conflicts, violence and the underdevelopment of food markets.

This institution adds: “Africa is characterized by the precariousness of most jobs, the large size of the informal sector (i.e. 89% of total employment), the limited coverage of pension and unemployment insurance schemes , and the predominance of micro, small and medium-sized enterprises (i.e. 90% in business activities)”.

In a document entitled “Measurement of the impact of Covid-19 on economic units” published in July 2020 in Kinshasa, the National Institute of Statistics of the DRC writes: “The companies most affected were those in the city of Goma, with 98% of the companies having answered to have experienced a fall in their turnover. Less than 6% of companies in three major cities in the DRC (Kinshasa, Goma, Lubumbashi) have put employees on technical leave since April. In Goma, 13% of economic units have given technical leave to their employees, 59% of whom are women”.

Covid-19 has not yet ended in the DRC, especially with the Omicron variant. Since the start of the pandemic declared on March 10, 2020 in Kinshasa, the cumulative number of cases, as of January 24, 2022, is 85,019 confirmed cases, including 85,017 and 2 probable cases. In total, there were 59,347 people cured and 1,278 deaths (1.5% lethality).

Many industries are operating below capacity , says Kimona Bononge, managing director of the Federation of Congo Enterprises

A few ideas for local solutions

Faced with this situation, many Congolese resort to the system called “AVE” (Village Savings and Credit Association), a kind of microfinance that takes place in a group whose number varies between 10 and 25 people.

These members of a “VSLA” make a contribution that the organizers call “initial capital”. The amount is chosen according to the financial possibilities of each member. Members apply for loans that help them carry out income-generating activities. The solicitor pays the money back with 10 percent interest, the practitioners explain.

“I, for example, thanks to this system, I had 150 dollars which helped me to resume my sales activities which were on the ground”, testifies mother Nzuzi Kingata, one of the women of Kikwit in the province of Kwilu.

Another local solution is that linked to the creation of relief funds. This is the case with the journalists of the “CJKDH” (Kikwit Journalists’ Club for Human Rights) who created, last October, a “Professional Relief Fund” to help journalists to have the means to help them to do their work independently.

For its part, the government has taken the decision to grant some subsidies to private and approved schools which are economically suffocated by the Covid-19. Solution that is running.

Basankusu market in the DRC

Awiwi Mimbu, a Congolese economist, offers government subsidies, tax and other exemptions (relief in charges related to the payment of certain basic services: water, electricity, etc.).

*Culled from February Issue of PAV Magazine

 

 

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