The ongoing conflict in Central African Republic has brought the country's economy to its knees, with dire consequences for the entire population. Food markets are close to collapse, and the annual 'hunger season' already underway, says WFP’s Chief Economist Arif Husain, just back from C.A.R.. In this article, Husain explains why it would be hard to imagine a scenario worse than C.A.R.'s current predicament.
ROME -- The Central African Republic – torn apart since December by widespread conflict and killings of civilians by armed groups – is unravelling. The consequences are already catastrophic for many people. Almost the entire population is in desperate need of food.
As the World Food Programme's chief economist, I went to Bangui to analyse how the overall economy is affected, particularly the food sector, and where we are in terms of the humanitarian response. I was shocked by what I saw and how deep the crisis extends. It really doesn’t get much worse than this.
Unemployment in both the formal and informal sectors is rampant – estimates are that it stands at as many as three-quarters of the workforce.
Most civil servants have not been paid for the last six months and public service pensioners have not been paid for more than a year. Those who were lucky enough to get one month’s salary in March had to pay back immediately debts to the bank disbursing the salaries—so basically they did not get anything.
There is hardly any liquidity in the economy as public coffers are essentially empty and revenue collection isn’t working. Already in 2013, exports were down by about 60 percent and imports by more than a quarter compared to 2012. The mining sector alone had contracted by two-thirds compared to a 10 percent increase in 2012.
Commerce sector gutted
The commerce and transport sectors are gutted with the near total departure from CAR of the Muslim community who pretty much ran most of these businesses. This is a severe blow to the economy that has brought much of the country to a standstill.
Lack of transport, insecurity and informal taxation severely hinder trade from neighbouring countries and the domestic supply of produce, particularly the movement of locally produced commodities from surplus-producing areas to deficit areas such as Bangui.
Furthermore, the largest wholesale food market in Bangui is near collapse and quickly running out of stock. About 70 percent of the traders have left and current stock levels were between 10 to 20 percent.
Food security is perhaps best described as ominous with the hunger season having started at least two months earlier than usual
and expected to worsen over the next several months.
Even before this, CAR was a hard place to be a child. Its under-five mortality rate was 129 per 1,000 live births, the sixth highest level in the world. Nearly half of its children under five were stunted and 25 percent were underweight. Life expectancy was one of the lowest in the world. So this crisis is exacerbating an already bad situation.
What’s clear is that this is no longer just about internally displaced people and refugees. The general population is now affected – directly or indirectly. This disaster is broadening and will last longer.
More worryingly, chances of an even worse agricultural season this year compared to last year are real, unless the security situation improves substantially and very quickly. Furthermore, many farmers have lost their agricultural inputs and tools need replacements now, during the planting season, which has already started.
The bottom line is that within CAR and in the region, WFP did not have enough funds to buy and pre-position enough food in advance of the rains. The resources currently available to WFP are nowhere near what is needed to match the increasing needs. Other aid agencies face a similar gloomy outlook regarding securing sufficient contributions to respond adequately.
All indications are for a long and costly humanitarian operation over at least the next 18 months. The combination of insecurity, destruction and disruption of transport and commerce, the onset of rains and the lack of funding are a huge challenge for all who must respond.
We need to scale up and do much more now because every passing day only makes this emergency operation more difficult and more expensive and steals more innocent lives.
(This piece first appeared in the Ottawa Citizen)