By Odinaka ANUDU and Carey MULINDI
IN April 2021, President Iván Duque Márquez of Colombia proposed to increase taxes on food and utilities in order to mitigate a COVID-19-induced economic crisis.
His economic consideration for raising taxes was to provide more funds for Ingreso Solidario, a programme targeted at making 13-monthly payment of $43 to low-income populations of the South American country.
The Ingreso Solidario had been designed for families ravaged by the virus, but it captured only six per cent of Colombia’s 50.34 million population.
The Director of the German Institute for Global and Area Studies in Latin American Merike Blofield described the programme as ‘weak’ compared to others initiated by countries in the region.
In order to expand Ingreso Solidario to accommodate 1.7 million more people and to establish a permanent basic income programme for them, the Colombian president prepared a new tax reform to raise $4.8 billion for the programme.
With incomes declining and 42 per cent of Colombians earning below $90 per month, protests began on April 28, leading to the death of six persons.
As protests spread, Colombia’s COVID-19 cases surged, placing the country as the third worst virus case in Latin America, with the gloomiest economic performance in 50 years and an unemployment rate of 14 per cent.
Human rights group said more than 50 Colombian civilians died in the protests owing to the police’s use of brute force.
The Inter-American Commission on Human Rights said the security forces employed ‘lethal force’ in handling civilians, BBC reported in early July, 2021.
Despite a third wave of COVID-19 ravaging Colombia, the South American country eased lockdown to assuage the sufferings of the citizens. However, the new measures rendered previous virus restrictions nearly useless.
The Colombia Health Ministry said that the country would no longer require a negative coronavirus test from travellers entering the country by air.
The ministry further said that concerts, large sporting events and nightclubs would be allowed at 25 per cent capacity in cities with less than 85 per cent occupancy of ICU beds.
Colombia is not the only country feeling the negative impacts of COVID-19 restrictions.
Argentinian citizens are protesting across the country over poverty and unemployment as economic crisis, worsened by the virus, hits the country.
With 42 per cent of 45 million Argentinian population living below poverty, citizens have failed to make head or tail of COVID-19 lockdowns imposed by the government.
“The soup kitchens are seeing whole families coming to eat and many of the children have to be attended to by health professionals because they are malnourished,” Aljazeera quoted leader of the left-wing Corriente Clasista y Combativa and lawmaker Juan Carlos Alderete as saying.
Argentina provided several fiscal measures such as loans, moratoriums and tax deferrals to businesses and individuals, but these have failed to reduce poverty.
“One of the lessons Nigeria can learn is to avoid aggravating the challenges facing the people. This is the poverty capital of the world and I expect government to understand this. If you cannot assuage the plights of the people, at least do not worsen them with bad policies,” Economic analyst and political philosopher Ike Ibeabuchi said.
“Nigerian government does not have all the money in the world to help those affected by the pandemic, but it can ensure that its palliatives get to the poor. Is this happening? Not sure. Last year, we saw how some of the relief materials got to politicians, rather than the poor.”
Nigerians protested amid rising cases of COVID-19 in October 2020, but it was on account of police brutality. Lives and properties were lost to the crisis and about N700 billion was lost in 12 days, according to the Lagos Chamber of Commerce and Industry.
Analysts call for reforms that would positively impact the lives of the poor and the vulnerable who are ready to copy the examples of Colombia and Argentina to worsen COVID-19 situation in Nigeria.
“The government should commit to rapid improvement in governance quality and accountability by effecting necessary institutional, policy and regulatory reforms not only for the police but the entire public sector ecosystem,” Former Director-General of the Lagos Chamber of Commerce and Industry Muda Yusuf said.
Like Colombia, Nigeria is in the third wave of COVID-19. And like the South American country, Nigeria is not making life easy for cash-strapped citizens as legal and illegal taxes are imposed on micro businesses and the people.
One of our reporters found that micro or nano businesses in Lagos, Nigeria’s richest city, paid an additional N513 illegal tax (on the average) each day in 23 local councils in the state.
A micro businesswoman dealing in phones, chargers and batteries in Ikeja, Lagos, Jane Ogunkoya, said: “At least four groups of people come here every day, asking us for all forms of illegal taxes. We have no choice but to pay.”
Some of Nigeria’s 36 states are imposing new legal taxes, like President President Iván Duque Márquez of Colombia, without caring about the consequences.
Nigerian newspaper The Punch reported that Kaduna State introduced N1,000 in 2021 to be paid by every adult in the state.
Executive Chairman of the Kaduna State Internal Revenue Service Zaid Abubakar said that the payment of the levy was in line with Section 9 (2) of the Kaduna State Tax Codification and Consolidation Law, 2020.
On November 9 2020, Kogi, another state in Nigeria, announced a levy on every loaf of bread baked in the state.
The Ministry of Commerce and Industry said the levy was targeted at improving its internally generated revenue.
However, Governor of the state Yahaya Bello denied imposing the tax when criticisms heightened.
In 2020, the International Monetary Fund (IMF) warned Nigeria against raising taxes as it was inappropriate in a pandemic.
“We do not think it is the right time to raise taxes due to the impact of the pandemic,” IMF Mission Chief for Nigeria Jesmin Rahman said in a virtual fireside monitored by one of our reporters.
Group Head of Tax at the United Bank for Africa Emeka Amadi said multiple and illegal taxes were ‘a time bomb.’ He suggested the need to clarify the number of taxes to be paid by taxpayers and businesses.
He said that multiple taxes could deepen poverty and lead to chaos resulting from increased hardship.
Nigeria is world’s poverty capital, with over half of 210 million people living in extreme poverty, according to the World Poverty Clock 2020 report.
Like Colombia and Argentina, Nigeria has designed relief programmes for individuals and small businesses, but there is no data on the number that has been impacted.
Small businesses who spoke with one of our reporters said they could not have access to any of the funds.
“I was not able to get any money as relief during this period,” a retailer of household items Agatha Aina said.
Nigeria has nearly 42 million small businesses contributing 50 per cent to the Gross Domestic Product (GDP) and accounting for over 86 per cent of jobs (nearly 60 million jobs in 2017), according to a report by the National Bureau of Statistics (NBS) and the Small and Medium Enterprises Development Agency of Nigeria (SMEDAN). However many of them are struggling to survive.
National President of the Association of Small Business Owners (ASBON) Femi Egbesola told one of our reporters earlier that COVID-19 relief programmes should be expanded to uplift small businesses and the poor to create jobs and arrest the country rising unemployment, which stood at 33.3 per cent in the fourth quarter of 2020.
Former Central Bank of Nigeria Governor Chukwuma Soludo has advised Nigeria and Africa to not copy the lockdown measures imposed on citizens by developed countries, saying that doing that would compound their economic woes.
“What many do not seem to appreciate is that African economies are facing their worst economic condition in decades. Commodity prices have fallen dramatically, and for oil producers, the situation is precarious,” he said.
He advised developing nations to urgently dismantle the border closures as well as the stay-at-home/lockdown orders.
“Several African countries have ‘announced’ intervention funds that, at best, constitute a drop in the ocean relative to need. The buffers and institutions for dynamic adjustments are weak or absent. In most countries, subnational governments are pleading for bailouts from their cash-strapped central governments. Many of these subnational governments will soon realize that they are basically on their own, and many could become fiscally insolvent.”
Soludo said as some useful data were gathered, and lessons learnt, nations could begin to craft simple, smart, and sustainable heterodox responses, rather than lockdowns that would prove ineffective.
Since the emergence of the Delta variant in Kenya, the 14 Lake regions have been heavily hit.
According to the World Health Organisation (WHO), most African countries need to strengthen surveillance and sequencing capacities and apply a systematic approach to provide a representative indication of the extent of COVID-19 transmission based on the local context, and to detect unusual events.
As the Indian case shows, situations can deteriorate rapidly. In many of the African countries in which case sequencing data is available, the Delta variant is on the rise.
The evidence suggests that, overall, African countries are continuing to face the COVID-19 crisis with vigilance and caution.
The stringent lockdown measures imposed in the countries has remained roughly constant since November 2020, notwithstanding some counties’ variations.
Until a mass vaccination is extended countrywide, including those in remote areas, they face few choices as invasive lockdown measures for suppressing COVID-19 continue to hurt economies.
The trickledown effect of lockdowns on the Kenyan economy is felt by the commoners in rural areas.
Kenya share similar socio-demographic features as India: a youthful population, large rural populations that spend a significant portion of the day outdoors, large extended family structures, few old age homes, densely populated urban areas, and weak tertiary care health systems.
As in India, Kenya has been loosening social distancing and other preventative measures. A recent survey by the Africa Centres for Disease Control and Prevention (Africa CDC) revealed that 56 per cent of African states were “actively loosening controls and removing the mandatory wearing of face-masks.”
Moreover, parts of Africa have direct, longstanding ties to India, providing clear pathways for the new Indian variant to spread between the continents.
India’s COVID-19 surge was also seemingly driven by a variety of super-spreader events. Most prominently were two international cricket matches in Gujarat State in western India where 130,000 fans converged, mostly unmasked, at the Narendra Modi Stadium.
Similarly, the LAke region in Kenya experienced the Delta variant after the government held a national celebration in the lakeside city of Kisumu.
It led to a surge in numbers of Delta variant cases.
Medical professionals in India say the new variant is infecting more young people compared to old. Experts say Kenya should avoid super-spreader events that could expose the vulnerable to the Delta variant.
Gateway countries such as Egypt, Algeria, Morocco, and South Africa have among the highest levels of international trade, travel, tourism, and port traffic on the continent. This makes them vulnerable to potentially more infectious and deadly variants that have emerged from other parts of the world such as India.
The interconnected nature of Kakamega and Kisumu through the International airport is attributed to the early detection of the Indian variant in Lake region Counties. This means that Mombasa, Eldoret and Nairobi with international airports should be on high alert.
African governments, especially Kenya, need to ramp up all phases of their COVID-19 vaccine rollout, including using public awareness and education, identification of vulnerable populations for prioritisation, and logistical preparations and outreach, medical experts say.
India had 32.2 million COVID-19 cases and 423, 000 deaths as at August 16, 2021. But the Asian country has ramped up vaccination. Though only 8.9 per cent in India have been fully vaccinated, the number of fully vaccinated population in Kenya is only 1.4 per cent.
Kenya Ministry of Health confirmed 20 new deaths on April 22 and 23 new deaths on April 28.
The ministry also said the country reported 550 new COVID-19 cases from a sample size of 4,087 tested on July 26, representing a positivity rate of 13.5 percent, Daily Nation reported.
Kenya, like India, must expand vaccination to tackle rising COVID-19 deaths in the East African country.
This publication was produced as part of IWPR’s Africa Resilience Network (ARN) programme, administered in partnership with the Centre for Information Resilience (CIR), the International Centre for Investigative Reporting (ICIR), and Africa Uncensored. For more information on ARN, please visit the ARN site.