Comparative Study of Policy Responses to COVID-19 in LICs in Africa

This policy brief by the South African Institute of International Affairs assesses the economic policy responses of low-income countries (LICs) in Africa to the COVID-19 pandemic. It finds that while these countries employed expansionary fiscal and monetary tools, the scale and quality of their responses were modest compared to developed and middle-income nations due to pre-existing structural bottlenecks, high debt, and limited fiscal space. The document emphasizes the need for a data-driven recovery approach, increased digital and financial inclusion, and the continued importance of official development assistance, particularly for fragile states.

• The economic responses of African LICs to COVID-19 were modest in scale and quality compared to emerging and middle-income countries, largely due to pre-pandemic challenges including high debt levels, inflation, and limited fiscal space.
• Fiscal stimulus in most African LICs was small, typically ranging from 1% to 2% of GDP, with Senegal, Niger, and Mozambique being exceptions by providing injections exceeding 4% of GDP.
• Expansionary monetary policy was the most frequently used economic tool among African LICs, often because fiscal options were constrained by weak revenue and high debt. However, nine LICs implemented no monetary policies due to weak financial markets.
• Exchange rate policies played a minor role for most LICs, though Zimbabwe explicitly shifted from a flexible to a fixed exchange rate to manage a forex crisis, and other countries like Uganda, Comoros, and Sierra Leone committed to market interventions.
• External financing and donor support were critical but insufficient. While fragile states received a higher proportion of their appealed funds—such as Somalia (60%) and the Central African Republic (54%)—others like Uganda (5%) and Tanzania (7%) received very little.
• A comparison with the 2007–2008 Global Financial Crisis (GFC) shows that while both involved external shocks, the COVID-19 crisis had a greater magnitude and speed, and is expected to cause a sharper increase in poverty rates.
• Recovery efforts should prioritize addressing structural weaknesses exposed by the pandemic, specifically broadening the digital economy, improving financial and social inclusion, and ensuring the independence of monetary and debt management authorities.

APA

South African Institute of International Affairs (2020). Comparative Study of Policy Responses to COVID-19 in LICs in Africa. https://saiia.org.za/research/comparative-study-of-policy-responses-to-covid-19-in-lics-in-africa/

Chicago

South African Institute of International Affairs. Comparative Study of Policy Responses to COVID-19 in LICs in Africa. 2020. https://saiia.org.za/research/comparative-study-of-policy-responses-to-covid-19-in-lics-in-africa/.

Wikipedia

{{cite report |author=South African Institute of International Affairs |title=Comparative Study of Policy Responses to COVID-19 in LICs in Africa |date=18 December 2020 |url=https://saiia.org.za/research/comparative-study-of-policy-responses-to-covid-19-in-lics-in-africa/ |access-date=17 August 2026 |via=Climate Insights Directory}}

BibTeX

@techreport{southafricaninstituteofinternationalaffairs2020comparative, author = {{South African Institute of International Affairs}}, title = {{Comparative Study of Policy Responses to COVID-19 in LICs in Africa}}, institution = {South African Institute of International Affairs}, year = {2020}, month = dec, url = {https://saiia.org.za/research/comparative-study-of-policy-responses-to-covid-19-in-lics-in-africa/}, urldate = {2026-08-17}, note = {Indexed by Climate Insights Directory} }