Addis Ababa, 9 December 2021 – Harare is embarking on a new economic and financial resilience plan, with the support of the United Nations Economic Commission for Africa (ECA), to tackle the effects of the COVID-19 pandemic and build its resilience against future shocks.
The local government of Harare introduced the plan at a multi-stakeholder meeting in Harare on 8 December. When fully financed and operationalized, it will play a crucial role in building the city’s capacity to shield its economy and financial stability from future crises.
Developed after extensive multi-sectoral consultations and an in-depth diagnostic study, the plan seeks to improve Harare’s labour market, financial system, infrastructure and connectivity, economic governance and business environment.
Underlying economic vulnerabilities
The city of Harare put in place a number of measures in response to the pandemic, including city-wide spraying, hand washing facilities and upgraded hospitals capacity. A COVID-19 taskforce and a rapid COVID-19 response team were also established at the local level following the outbreak of the pandemic in Zimbabwe.
According to a diagnostic study undertaken in the city, the pandemic and virus suppression measures adversely affected the economic performance of Harare and the funding for its basic services. Job losses, declines in household income and reductions in productivity were especially pronounced challenges in Harare.
Findings revealed that the contraction of the local economy resulted in a financing gap, stemming from decreased revenues and increased expenditure at the municipal level - underscoring the need to improve the city’s ability to raise and mobilize domestic resources.
Regarding the vulnerabilities, the study recommended that Harare should diversify its economy, establish incubators for informal entrepreneurs, accelerate its digital transformation and improve access to affordable finance. It further called for the expansion of social protection schemes and the upskilling of workers to improve local labour market conditions.
The study also identified the need for setting up a local agency to attract investors to Harare while generating city-level data to facilitate evidence-based planning in service delivery. Additional proposals included crisis-informed city planning, private sector investments in infrastructure, participatory budgeting processes, and the inclusion of vulnerable groups in resilience-building efforts.
A forward-looking approach’
In her statement, Dr. Edlam Yemeru, Director a.i. for ECA’s Gender, Poverty and Social Policy Division, said: “While African cities are the epicentre of the COVID-19 crisis, they are also at the heart of the solution. But their largely unplanned and poorly managed urban development makes cities vulnerable to the risks posed by COVID-19.”
As a result, African cities, including Harare, have suffered enormously during the pandemic in the form of employment and household income losses, she added, with local governments losing up to two-thirds of their generated revenues.
Dr. Yemeru continued: “This crisis is a turning point to rethink how we overcome development deficits in our cities and adopt a forward-looking approach that can better predict, learn from and absorb future shocks.
“In this regard, Harare’s economic and financial resilience plan offers a holistic framework which the local government can implement to put the city onto a shockproof economic trajectory that works for both its residents and businesses.”
In his welcome remarks, Councillor Stewart Mutizwa, the Acting Mayor of Harare, expressed his gratitude for ECA’s support in the drafting of the plan. He encouraged the meeting participants to share their insights on the plan so it could adequately reflect and respond to the needs of Harare.
Meeting participants, including city officials, academics, business leaders and UN delegates, reviewed and endorsed the plan, which will feed into Harare’s one-year stabilization plan.
The ECA-supported plan is part of a wider United Nations project which seeks to strengthen the capacity of local governments in 16 cities globally on building urban economic resilience in the wake of the COVID-19 pandemic.
Economic Commission for Africa
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Tel: +251 11 551 5826