Report fingers big corporates as key beneficiaries of pandemic cash

By Isaac Oganga

Kenya’s biggest corporations massively profited from the pandemic funding at the expense of small firms which were left exposed when Covid-19 hit, a new report has shown.

The report, Towards a People’s Recovery: Tracking Fiscal and Social Protection Responses to COVID-19 in the Global South, found that 63 per cent of foreign funding from the World Bank and International Monetary Fund (IMF) among other donors went to big businesses – who could have had a lot of cash on-hand to shield workers, adjust small firms’ business models and prevent costly public bail-outs.

Authored by the Financial Transparency Coalition (FTC) and its partners, the survey analyzed data from nine countries Kenya, South Africa, Sierra Leone, Bangladesh, India, Nepal, Honduras, Guatemala, and El Salvador, also found that just a quarter of the funds went to social protection.

In Kenya for instance, the survey found that 92 per cent of Covid-19-related bailout funds went to big corporations rather than to those facing poverty despite the country’s corporate tax rate being the lowest in East Africa.

“Most countries in the Global South were able to determine where to direct their public Covid-19 bailout funds.

There are a whole host of reasons, however, why they did not direct resources to social services, and these ranged from the inadequate capacity of governments to identify vulnerable populations in their respective countries to lobbying by the private sector for policy change in their favor,” said Chenai Mukumba, Policy Research and Advocacy Manager at Tax Justice Network Africa (TJNA).