KENYA HOST POVERTY REDUCTION WORKSHOP

POVERTY REDUCTION WORKSHOP HELD IN KENYA

By Donald Kogai

African governments must adopt a pro-

growth poverty reduction strategy as a

key policy element to achieve

sustainable poverty reduction in the

post-pandemic.

Dr. Kisu Simwaka while speaking on

behalf of Dr. Wilson Banda, the

Governor Reserve Bank of Malawi said

that most African economies are

vulnerable to external shocks and the

Covid-19 pandemic has exacerbated the

situation widening the poverty gap

hence the need for support to cushion

households with limited financial

resources.

“In sub-Saharan Africa, we are

constantly at risk of being pushed back

into extreme poverty during economic

downturns and other external shocks.

The pandemic has worsened the situation

for many countries, and without steps

to address these disparities, the risks

this trend poses will continue to

grow,” Dr. Simwaka said.

A similar opinion was shared by Dr.

Jane Kiringai, Chairperson Commission

for Revenue Allocation in Kenya: “We

have to adopt a multiplicity of

economic instruments, and the policy

mix adopted by each state will be

country-specific depending on their

growth levels.”

During the African Economic Research

Consortium (AERC) 56th Biannual

Research Workshop, delegates including

policymakers, researchers, academics,

non-state actors, and economists

examined how Covid-19 has affected the

dynamics of poverty and growth

redistribution, as well as social

inclusion in Africa.

In his presentation, based on the

Kenyan case study on Poverty reduction

through growth, redistribution, and

social inclusion in times of COVID-19

Pandemic, Prof. Germano Mwabu of the

University of Nairobi noted that as

African countries emerge from the

impact of the pandemic, the pro-growth

policies we consider must lead to lower

poverty levels in the long run as well

as benefit the poorest 40% of the

population.

He proposes economic policies that

trigger the virtuous spiral, including

universal cash transfers to the poor;

social protection; investments in human

capital and social infrastructure;

participation in wage and self-

employment; and inclusive business

models that promote partnerships

between large and small enterprises.

“The findings from Kenya justify the

adoption of a pro-growth policy package

as the center of any poverty reduction

strategy and pro-poor measures that

complement such a package by offsetting

potential short-run increases in

poverty,” Prof. Mwabu remarked.

In his remarks, Prof. Leonard

Wantchekon of Princeton University

noted that the post-pandemic strategy

should be anchored in inclusive growth

and broader access to economic

opportunities.

“The support for achieving inclusive

growth in developing countries should

include investment in infrastructure to

achieve high sustainable economic

progress, connect the poor to markets,

and increase their access to basic

productive assets,” Prof. Wantchekon

said.

Despite the extraordinary gains made in

living standards over the past two

decades, hundreds of millions of

Africans are still excluded from the

benefits of rapid economic growth. AERC

envisions an inclusive continent where

all share the region’s gains and

opportunities. Unfortunately, the

pandemic has exacerbated pre-existing

inequalities in Africa.

AERC Executive Director Prof. Njuguna

Ndung’u said that the strong growth

will significantly reduce poverty in

Africa. Still, it has to be

supplemented by targeted social

protection programs that will flatten

inequality in the long term and create

social inclusion.

The pandemic, he said, has been quite

devastating in African economies. The

post-COVID economic recovery strategy

will focus on how these issues can be

managed. That is how we can accelerate

growth that can reduce poverty, and

social inclusion, among other

constraints in the development

discourse.

“A pro-growth poverty reduction

strategy is a critical pillar in this

development discourse and the future of

African economic recovery. This is

different from the Pro-poor growth

strategy that has been a pillar in the

last several decades,” Prof. Njugana

said.

While presenting on the impact of

COVID-19 lockdowns on the labour market

in Ghana, UNUWIDER Research Associate

Dr. Simone Schotte noted that the

lockdown measures had an immediate

effect on the labour market, causing a

substantial decline in employment.

“Workers in informal self-employment

were most affected by restrictions with

a nationwide impact. Despite the

current remarkable recovery in

employment, the pandemic had a

persistent nationwide effect that may

have exacerbated pre-existing earnings

inequalities,” Dr. Schotte noted.

While revisiting poverty trends and the

role of social protection systems in

Africa during the COVID-19 Pandemic,

Dr. Kibrom Abay, Country Program

Leader, and Research Fellow at IFPRI,

noted that the pandemic is a strong

reminder for African countries to

diversify their economies to withstand

future pandemics. He also stated that

although the number of social

protection programs in Africa has

increased, their reach remains limited.

These programs cover only a small share

of the population.

“The continued challenges remind us of

the need to reinforce social protection

programs to protect the vulnerable

households as social protection appears

to be the most popular instrument.

Reinforced either through increasing

the size of transfers or expanding the

number of beneficiaries,” Dr. Kibrom

emphasized.

The plenary was chaired by Prof. Finn

Tarp of the University of Copenhagen.

Dignitaries grazing the occasion

included Dr. Denny Kalyalya, Governor

Bank of Zambia; Dr. Jane Kiringai,

Chairperson Commission for Revenue

Allocation (CRA) Kenya; Prof. Leonard

Wantchekon of Princeton University; and

Dr. Rose Ngugi, Executive Director

Kenya Institute for Public Policy

Research and Analysis (KIPPRA)

The conference brought together over

300 high-level policymakers,

researchers, media, economists,

academics, and non-state actors in a

lively mix of speeches, presentations,

plenary and concurrent sessions.