African Businesses Shifting to New technologies of Responding COVID-19 pandemic

Addis Ababa, August 25/2020(ENA) African businesses are shifting towards new technologies in response to COVID-19 in the continent, a report issued by the Economic Commission for Africa (ECA) and International Economic Consulting Ltd indicated.

According the second comprehensive survey conducted on-line on the COVID-19 pandemic and its economic impact across Africa aims at providing insights into the effects of the pandemic on economic activity for businesses across the continent,  identifying the challenges they face and their responses.

Reduced opportunities to meet new customers; drop in demand; and lack of cash flow are the top three challenges faced by the companies in the continent, the survey results indicated.

Companies have faced serious disruptions in both supply and market due to COVID-19 with unfair pricing are also seen as a major concern.

Feedback from companies about government assistance is mixed with nearly two-thirds of the respondents indicating from moderate to no satisfaction.

As a consequence, "50 percent of the respondents approached financial institutions from which 25 percent got positive responses; among the latter, 42 percent were not satisfied with the service due to high interest rates, delays and collateral requirements,"   pointed out the survey.

When it comes to their performance, companies are currently working at about half their capacity.

The survey indicated that two-thirds of the surveyed companies have identified new opportunities in response to the crisis.

Those opportunities attest to a clear shift towards new technologies, particularly the development of online platforms for e-commerce.

While, the current share of e-commerce revenues remain relatively small (16 percent) due to challenges around internet connectivity, payment gateways and logistics.

It was pointed out that nearly half (47 percent) of the companies are moving or planning to move towards innovative/digital solutions through collaborations and partnerships.

Economics Affairs Officer at the Regional Integration and Trade Division in ECA, Simon Mevel, said: “Very interesting to note that firms involved in goods and medium and small scale enterprises (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”.