Stears Business Newsletter: When and what to reopen in Nigeria
An open sign.  Source: Leyre Labarga vis Unsplash

Welcome to our weekly insight on the Nigerian economy. Subscribe to receive this in your mailbox here

 

The world is now entering the second round of the fight against the coronavirus. Hopefully, there’s a knockout before the 12th - with us winning the match.  

The main pandemic related discussion has now moved from locking down the economy to opening it up. There’s traffic again in the streets of Wuhan, Italian coffee shops are busy, beaches are full, and premier league football restarts on June 17. 

For governments, the pandemic has become more of an economic and social crisis than a health one. And so they are desperate to get life back to “normal” as soon as possible. 

But this seemingly innocent drive hasn’t come without controversy. How quickly should we reopen? What sectors or institutions should be allowed to open? The debates have been endless. 

In today’s newsletter, we’ll run through these two questions in both a Nigerian and global context. 

 

The peak daily cases approach 

The first thing to clear up is that until a vaccine becomes available, there isn’t any chance of going back to normal in this next phase. The economic and social impacts of the lockdown have been hard, but the virus is still on the loose. 

If we’re not cautious, then there is a risk of a second pandemic (or wave) occurring. This is a popular theme with viruses. The Democratic Republic of Congo is on its 11th Ebola outbreak. 

Evidence shows that lockdown measures have successfully curtailed the peak of the virus. According to the IMF, COVID-19 deaths would have been at least ten times larger in a country like New Zealand if stringent containment measures weren’t enforced. 

So we’ve done well given the circumstances. But if we go back to the usual way of life, we can go back to square one. It could be the Wuhan and Italy situations all over again. 

Therefore, any form of reopening has to consider at least two things. Resuming operations under new guidelines and being prepared to close up again if there is a second wave of the virus. 

The image of a wave is the picture to have in mind when considering the right time to reopen. 

Globally, countries are reopening after descending from their highest levels of new daily cases and settling at a lower, controlled daily count.  

Public health officials determine the exact number that is “low” enough. It varies by country and depends on the strength of the healthcare system, particularly its ability to “test and trace.” 

That is a measure of control.

 

Three not so random examples

Let’s look at a few countries to illustrate this. 

In Hubei province, China - the first new cases recorded by Johns Hopkins University were 95, on January 22. The region reached a peak of 15,000 new daily cases on February 13. And by the time shopping centres reopened on April 8, new daily cases were at 0. 

Italy - the country started with 2 cases on January 31. It then reached a peak of 6,600 new daily cases on March 20. Shops and restaurants reopened on May 18 when new daily cases were 2,300. 

UK - the first case was recorded on January 31. A peak of 8,700 new daily cases was reached on April 9. Some primary schools reopened on June 1 when daily cases were 1,650. But shops are not due to open until June 15.  

These three examples are not random; they show countries at different stages of the pandemic wave. Hubei reached a peak in February, Italy in March, and the UK in April.  

These different months directly determined the reopening of non-essential stores.

Wuhan waited two months after the peak to open stores in April, Italy waited a month after its peak and reopened in May and the UK, one month behind reopened in June. 

This is a consistent global policy where you reach the top of the wave (peak daily new cases) and then begin reopenings when cases have dropped to a lower consistent level. 

The approach makes sense because this is the point where the crisis is under control. Healthcare systems are not overwhelmed and if a second wave of cases rises quickly, there is room to tackle it. 

Italy couldn’t reopen its economy back when it was running out of hospital beds. 

From the three examples, we can see that there is no magic number in terms of when to reopen. Hubei reopened stores at 0, Italy 2,000 and the UK will be around 1,000 new daily cases when shopping is allowed in less than two weeks time. 

 

Has Nigeria reached its peak?

Unfortunately, it’s hard to say where Nigeria is on the wave. This is because of a long period of relatively low testing, which meant we had an even more inaccurate picture of true cases. 

Given that Nigeria and other African countries enforced lockdowns relatively faster than Europe, it’s possible we did a better job and have already passed our peak. But again, we didn’t test, and so we don’t really know what daily cases were. 

Currently, the peak number of new daily cases is 553, which happened on May 30. 

The safest assumption is that we are still travelling towards the peak or we have only just reached it. Cases are still rising rapidly - a third of all cases in Lagos were recorded in the last week. 

However, a third of all testing also happened in the same period. So we need to wait and see if new daily cases stay lower than 553 even as testing increases. That will be the signal that May 30 was indeed our peak day. 

 

A busy street in Lagos

Source: Ibrahim Ma'aji via Unsplash

 

 

Remember that different countries are at different stages. We had China, Italy, and then the UK. Africa as a continent is behind this group in terms of when the virus began to spread. Nigeria’s first case was a month after the UK’s. 

South Africa who was able to test at a fast rate from the beginning could provide a picture of where Africa is on its curve.

The bad news is that new daily cases are still rising quickly. Similar to us, a third of its cases have been recorded in the last week. This suggests that it’s not yet time to reopen non-essential services. 

Regrettably, Africa has been badly hit by the crisis. With less government funding for mitigation and a reliance on commodity prices, the economic impacts have been tough.  

South Africa is expecting to lose 5 million jobs in the first quarter of the year and Nigeria is expected to contract by -4.4% in 2020. Hence, the pressure to reopen will be even stronger. Peak or not. 

While this is going on, another effect of the pandemic that is not as obvious is the social impacts.

 

Why open up schools?

Essential services like hospitals and some financial services sectors have continued to run during lockdowns. Now that reopening is on the table; governments are deciding what other sectors should be opened. 

In essence, the decision depends on both the health risks associated with opening up the sector and how important the activity is for the economy. 

For example, nightclubs which involve close contact may not be the first on the list in a country where nightlife isn’t a vital sector for the economy or if deemed to have little social benefits.  

One sector that has received a lot of attention is education. When should schools reopen?

First, let’s understand why schools are being singled out. 

“The cost of inaction in education is huge. This generation is running the risk that we invest less in them” The director of education at the World Bank said on a webinar yesterday. 

Disruptions in a child’s ability to learn can have long term impacts on inequality and their wellbeing. 

Arguments in developed countries like the UK have included the fact that essential workers like those in the NHS are less able to work if their children are still at home. 

But for kids from disadvantaged backgrounds or developing countries, the issue is much more significant. 

The longer marginalised children are out of school, the less likely they are to return. According to UNICEF, being out of school increases the risk of teenage pregnancy, child marriage, abuse and other threats.

The inequality gap increase becomes apparent when you consider how learning has gone from a neutral school ground to depending on conditions at home - wifi, electricity, and even food. 

The thing is, schools are used for essential services such as school feeding, immunisation, and mental health support. According to UNICEF, more than 350 million children might not have access to regular school feeding and nutrition services.

Even with online solutions, children are disadvantaged. For all students, learning is not quite at its optimum level, but wealthier kids are better able to cope with the disruptions. 

A UK survey by the Institute for Fiscal Studies found that children from richer homes are spending 30% more time each day on educational activities than children from the poorest one-fifth households. 

As compelling as these arguments are. The risks still remain. An imperial college COVID-19 model placed schools to be just as risky in transmitting the virus as workplaces. 

Schools are no less risky than opening up the rest of the economy. 

 

When to open up schools?

The global consensus is that schools need to reopen. But when?

The answer is similar to the discussion we have above on waiting until daily new cases have passed their peak and remain at a controlled level. 

So while countries in Europe have started classes again, Nigeria has said it’s not quite ready due to the health risks. The government understands that we are still near our peak. 

The WHO has set out guidelines for reopening schools which include having the epidemic under control, a health system capable of coping with a resurgence, and a test and trace system in place to allow a swift response to new outbreaks. 

Nigeria shouldn’t consider reopening schools until we are closer to reaching these requirements. And given our current state, school reopenings should be left as a discussion for July, not now. 

 

How to open up schools

Nigeria isn’t ready because the reopening of schools requires a well-functioning process in place to avoid outbreaks. Several social distancing and other techniques need to be applied. 

For example, indoor capacity has to be kept low. Most countries are staging the resumption of different school years. In the UK, for example, only students with special educational needs, nursery, reception, Primary 1, and 6 students started school on Monday. 

No more than 15 students are allowed in a classroom, and there must be regular handwashing with kids keeping at least 2 metres apart.

Nigeria will have its nuanced issues in this respect. First, we will struggle to keep class sizes this small given our already overcrowded classrooms.  

Another problem is sanitation. According to the National Bureau of Statistics, only 28% of schools had access to handwashing facilities with clean water and soap in 2018. In the North East and North West, the figure is 7%.

 

A school in Lagos

Source: Doug Linstedt

 

 

Even if all measures could be followed, the risks of the virus spreading in schools is not 0. No public health expert can promise parents that their children are not at risk of contracting the virus. And that makes things tricky. 

For now, sending kids to school is not compulsory, as many parents will understandably be cautious. Even though kids are far less likely to get severe symptoms from the virus, parents may not want to take their chances. 

Even teachers will have reservations. 

“Dear President, I’m a teacher who is angry, anxious, and confused,” a teacher’s open letter in Egypt said. 

 

The (lack of) justification for reopening religious gatherings 

For just about any sector, you can use the logic we have discussed to determine if it should be reopened or not. Have we passed peak daily cases? What are the health risks? How essential is the sector?

However, the definition of essential in the context of the pandemic is not as straightforward as you would expect. 

While putting ambulance services under that tag leaves little room for arguments, Donald Trump’s labelling of religious activities as “essential” raised a few eyebrows last week. 

Religious gatherings have been a contentious issue from the very start of the pandemic. In Nigeria, restrictions were initially on services with more than 50 people, and then it became a complete ban when formal lockdowns started. 

Different religious groups have cried out in protest, and some even carried on with their services. Videos of a COVID-19 task force closing down religious activities across Nigeria were also making waves on social media. 

On May 18, the Presidential Task Force on COVID-19 announced a lockdown on Kano State. Moments later, Governor Abdullahi Ganduje said Eid prayers would be held in the state. 

From a health risk perspective, the ban on religious activities makes sense. These gatherings are commonly in the hundreds in a closed space. In churches, singing is involved, which is one of the easiest ways for COVID-19 to spread. 

There have been numerous cases where churches have become epicentres for the virus in the US. 

In one account, a pastor and his wife were the index patients in a county that reached 25,000 cases one month after a three-day church event was held. 

The economics also don’t justify a reopening. You don’t find churches or mosques in the NBS GDP economic report. 

 

The special treatment 

Despite these arguments, religious gatherings have received an “essential” pass. This is evident in the US, where only ten states banned these activities. In 15 states, services are allowed to take place without any restrictions on meeting size. 

There are certainly grounds for religious services being considered in reopening plans. There is no denying its value, especially in religious countries in Nigeria and the US. In 2015, Nigeria had the fifth and sixth largest Muslim and Christian population in the world.

However, as with every other sector, any reopening will have to come with guidelines. Such as number restrictions or bans on usual activities like singing.

Interestingly, The Nigerian federal government lifted the ban on places of worship on Monday. The requirements include wearing face masks, maintaining social distancing and properly washing or sanitising their hands before joining congregations. 

The federal government said states could determine their policies on the matter. 

Lagos State, the epicentre of the virus in Nigeria, initially kept the ban in place. It said religious leaders couldn’t agree with the state government on guidelines for reopening. 

In a contender for the funniest quote in the news this week, the government recounted what an Imam stated. “He doesn’t know what goes on at his back immediately he is leading a prayer. He said if more than 20 or 50 people were staying at his back, he was not going to take responsibility for their presence.” 

Despite that, two days later, on June 4, an agreement was reached - Lagos lifted the ban on religious gatherings, with operations allowed to start from June 19. The capacity limit was set at 40% with a cap at 500 people.

The continuous rise in daily cases says it’s too early unless Nigerians agree that physical places of worship are indeed essential. And in case anyone was wondering, singing will be allowed under the government’s new rules.  

 

Subscribe to receive this weekly newsletter in your mailbox here

The Newsroom

The Newsroom

Read Latest

The new broadband plan and Nigeria's digital future

ECONOMY - 10 JUL 2020

Graphics: What the new normal for air travel looks like

TIER 4 - 09 JUL 2020

Nigeria’s path to taxing the digital economy: Netflix and Amazon included

ECONOMY - 08 JUL 2020

Transporting blood in Lagos: Lifebank’s life-saving business model

TIER 4 - 07 JUL 2020