BFA Asset Management on Lusophone Africa’s COVID-19 response plan

As the COVID-19 pandemic continues to impact economies around the world, African Lusophone countries are facing unique challenges in responding to the crisis. Rui Oliveira, CEO at BFA Asset Management, provided insights into the government responses in countries like Angola and Mozambique during a recent interview with CNBC Africa. Oliveira, who has been in Portugal since the lockdown measures were implemented, discussed the efforts to cushion the economy and the risks posed by the pandemic in these nations. In Angola, there have been around 270 confirmed cases of COVID-19 and four deaths. The Angolan government initially declared a state of emergency, which allowed for certain measures to be enforced. As the situation evolved, discussions arose regarding the transition from a state of emergency to a state of calamity, which would enable some businesses to operate at 50% capacity and potentially reopen schools. The impact on the economy has been significant, particularly in sectors like oil exports, leading to disruptions in both operational and capital expenditures. The government is working towards reopening the economy while managing the ongoing health crisis. Moving to Mozambique, the country has also faced challenges due to the pandemic, with an impact on its economic recovery plans. Mozambique had earlier projected a GDP growth of 6% for the year, but this forecast is likely to be revised given the current circumstances. The gas market, which was a key sector for economic progress, has been affected by job cuts and reduced exploration plans by major companies. Political instability adds another layer of uncertainty to Mozambique's outlook, potentially affecting investor confidence and business operations. The government may need to consider lifting restrictions to revive the economy, but the pace of recovery remains uncertain. The COVID-19 crisis has introduced additional risks to these economies, compounding existing challenges like political instability and economic dependency on sectors like oil and gas. The need for comprehensive response plans that balance public health and economic considerations is becoming increasingly critical in Lusophone African nations. Investor confidence and business restarts will depend on the effectiveness of government measures and the recovery trajectory post-crisis. Rui Oliveira's insights shed light on the current status and future prospects of countries like Angola and Mozambique amidst the COVID-19 pandemic. As the situation continues to evolve, policymakers and stakeholders will need to collaborate effectively to navigate the complex challenges ahead and ensure sustainable recovery for these economies.