Ebola brings West African economies to an ‘alarming’ standstill | Video
The New Economy speaks to Robtel Neajai Pailey, PhD candidate at SOAS, University of London and Liberian native, about how the impact of the Ebola crisis in West Africa is stretching beyond the humanitarian field and into economic territory
Show transcriptWith the death toll in the thousands and an international emergency declared by the World Health Organisation, all eyes are on West Africa – which faces not only a health crisis but an economic one as a result of the Ebola outbreak. The New Economy speaks to Robtel Neajai Pailey, PhD candidate at SOAS, University of London and Liberian native, about how investors need to be held to Corporate Social Responsibility commitments.
The New Economy: In a Guardian piece, you spoke very vividly about dead bodies being left on the streets, people being afraid to even go to the health centres to get help, and hide instead in their homes with their families, because they just didn’t trust the infrastructure that was put in place. That is a series crisis of confidence that exists in the country – how do you even more forward when you’ve got that sort of situation and a highly infectious disease that we’re talking about?
Robtel Neajai Pailey: It’s incredibly demoralising for the Government to announce on the radio that it’s an international health crisis, people must listen to the Government, they must listen to the safely precautions, and ask people to take patients to the hospital – and when patients arrive, they have been turned away.
The New Economy: Now we of course, have these sobering statistics that have just come out from the World Bank. We know that this is not just Africa’s problem, but this is a problem that the world really needs to take issue with. According to the World Bank, the low Ebola scenario is that lost GDP for West Africa – $2.2bn in 2014, and $1.6bn 2015. The high – even worse – $7.4bn in 2014, $25.2bn in 2015.
Now according to the World bank statement, the problem is not that they can’t keep up with the immediate problems on the ground, but this is the larger business implications that we’re talking about, or a version behaviour by people who are investing in the country. I mean, they don’t even want to go in, they don’t want to leave with any of the products from the country. We are seeing a continent that is more interconnected than ever before, in terms of its investment behaviour. Now let’s talk about the topple effect that this situation is going to create for markets all over the world.
Robtel Neajai Pailey: Countries in the sub-region are sort of realising that ostracising and completely isolating these countries isn’t going to help them, because it has implications beyond just the three countries that are affected globally, where concession companies or investors are saying, well this a West African crisis and therefore we can’t trade with these countries because there might be Ebola cases.
The New Economy: But you know, we’re taking beyond the regionals, as you said about the broader implications. If we see a rupture of the financial markets that are integrated, and as a result you know it’s all over the world in just a few days. I’m not trying to fear monger, but what I am trying to say is that these broader implications then mean what? Does that mean that the foreign governments have to pour more money to solve this situation, try to mitigate the risk? Is that what you’re saying?
Robtel Neajai Pailey: Well I think that’s a part of it, and I think even the World Bank has introduced somewhat of a stimulus package for Guinea, Liberia and Sierra Leone, so that the broader implications of the outbreak on their economies, it doesn’t lead to complete collapse and fragility – that’s a welcome solution. And the World Bank is even saying that we’ve got to do a lot more than the initial $20m that we talked about, because the economies have pretty much come to a standstill, we have to find other mechanisms to ensure that there’s not complete economic collapse.
I mean, even talking to family members on the ground now, people who are petty traders involved in informal work, can’t sell their market just because they are so fearful of going out, and people are not even buying their wares. Farmers are not going to the farm, commodity prices are increasing and I’m thinking about the instability that this is causing for local house-holds who aren’t able to even sustain themselves. I mean it’s quite alarming.
The New Economy: It is, it is. Let’s go back to the idea of building this infrastructure, health infrastructure – what obligation to these foreign firms have, given that they are coming in that they are coming in and helping to reap the economic benefits for the Government, as well as for themselves. But those people on the ground – we have to make sure they’re taking care of, if the governments aren’t doing a satisfactory enough job, whose responsibility is it to make sure the healthcare reform is in fact enacted swiftly?
Robtel Neajai Pailey: Sure. It is the government’s responsibility. The private companies, they can only follow the government’s lead.
The New Economy: So do you think the Government should hold them more accountable? And say, you guys are coming in let’s talk about these deals we’re making with you, and we want to make sure that these deals are more balanced.
Robtel Neajai Pailey: Absolutely. And I think the Liberian Government, as I mentioned, with the county development funds and social development funds, this is something that the Liberian Government introduced – it wasn’t the concession companies saying that, oh we have a corporate social responsibility and therefore we will. The Government said no, this is our expectation of you, you are going to export our natural resources then you have to invest back in the people. Again, they haven’t held their feet to the fire in ensuring that they do invest in the people and healthcare and education.
The New Economy: Now lets think about some of the FTSE companies that of course ascribe to the belief that they should be engaging in Corporate Social Responsibility tactics, and that’s part of the boxes that they tick off when they’re promoting themselves internationally. What does that then do to enhancing the ability of the local Governments to hold these companies accountable?
Robtel Neajai Pailey: Well I think part of it is the CSR, the corporate social responsibility has become sort of rhetorical and it’s not in actuality reality on the ground, it’s not having the impact it should.
The New Economy: But companies are using it as a measure of ‘look we’re going into your region, your continent and this is what we’re giving back’. So you’re saying that it’s not making any difference on the ground?
Robtel Neajai Pailey: Well, I’m saying that in terms of reality, from what I’ve experienced in Liberia, those investments are actually not trickling down.
There was a conference in Abuja, Nigeria in 2001 all the African Union Governments decided to sign a declaration called the Abuja Declaration. And it basically implored and sort of insured that they would invest in healthcare, and they also asked for donors to ensure that most of the aid coming in would go towards healthcare finance. There have been 26 countries that have increased healthcare financing in the past 11 years, Liberia is among them. Obviously more still needs to be done.
The New Economy: Robtel you are a smart dynamic woman, obviously you are able to leave the country, get educated and then, you know, impart wisdom on the rest on the Western world, what needs to happen locally. What is it like for you’re to see your brothers and sisters back home dealing with these systemic issues, unable to move forward.
Robtel Neajai Pailey: It’s very disheartening actually. I mean, I think the only thing that is keeping me from wallowing in despair and disillusionment is the fact that I speak to my father every day, and he’s a glass half full kind of individual, he always says ‘we’re ok, we’re praying, we’ll get through this it’s just a matter of time’. And my question is how many people have to suffer in the process before we get through this? We have so much more work to do post Ebola.
The New Economy: Well you are part of that change. Robtel, thank you so much for joining me today.
Robtel Neajai Pailey: Thank you very much for having me.