The Impact of COVID-19 Pandemic on Social Welfare and the Health System Capacity of East African Economies: A Comparative Analysis

Cyprian Amutabi

MPRA Paper from University Library of Munich, Germany

Abstract: This study analyzed the degree of impact of COVID-19 on social welfare and health system capacity across some selected EAC countries using monthly series data for the period March 2020-May 2021. The potential Intensive Care Unit (ICU) bed and ventilator surge capacity were estimated based on the confirmed COVID-19 cases & the actual number of ICU beds and oxygen ventilators while the degree of variation of the pandemic’s impact on social welfare was analyzed using the Pooled Mean Group (PMG) estimator. The findings revealed the existence of significant gaps across hospitals in the EAC region in accommodating any potential surge in the caseload emanating from COVID-19. This was evidenced by a continuously rising number of confirmed COVID-19 cases against a backdrop of a limited number of ICU beds and ventilators needed to provide critical care. The PMG results revealed that COVID-19 significantly decreased the Consumer Price Index (CPI) in the long run. In the short run, the impact was negative and significant for Kenya but insignificant for Rwanda, South Sudan, and Uganda. Conversely, COVID-19 significantly increased oil prices in the long run. In the short run, the impact was positive and significant for South Sudan but negative and insignificant for Uganda. This study, thus, recommended adequate investment in the health sector targeted at a substantial increase in the number of ICU beds and ventilators. Further, governments within the region need to employ a coordinated approach in addressing welfare effects stemming from increased oil prices. There is a need to promote regional market integration & cooperation within the EAC region regarding oil. A robust & vibrant EAC oil market will enable countries within the region to harness optimal benefits from their oil reserves as well as withstand any global price shock dynamics that emanate from a pandemic of this nature.

Keywords: COVID-19; Health system capacity; Social welfare; PMG estimator; EAC region (search for similar items in EconPapers)
JEL-codes: H12 I14 I31 (search for similar items in EconPapers)
Date: 2021-11-19
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Persistent link: https://EconPapers.repec.org/RePEc:pra:mprapa:113739

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