April 2020

THE LOGISTICS & TRANSPORTATION SECTOR is absolutely crucial in this fight against COVID-19. The role it plays in the supply and delivery of resources makes it necessary that we mitigate the impact of the novel coronavirus in this sector so as to enable us mobilise effectively during this war. Transportation of products is simply the movement of said products from one point to another. The logistics of this is not that simple. Logistics management involves knowing the right products, and how much and how many is required, and what’s the correct time to get it at the right location, and getting it there in the right condition after all that. This would make transportation a subset of logistics.  Logistics is transportation plus everything else in between, including storage, packaging or repackaging, etc. The key to optimising our logistics and transportation is to find a good balance between efficiency and cost. But these times of need, when we cannot complain about the water bill when our house is on fire, the deployment of efficient logistics protocols is ever necessary to get what is needed by those that need it the most to where it’s needed on time and in the right condition, no matter the cost. Whilst logistics and transport companies have over the years enhanced their systems by investing into technology and other structures in order to harness more business opportunities, the COVID-19 pandemic seem to have temporarily dashed that hope, at least for the time being. When COVID-19 first hit the industry, the initial widespread response was to safeguard employees by following the guidelines set by the World Health Organization (WHO) and the governments of the countries they operate in, such as providing hand sanitizers and working from home. These measures were implemented with the main goal of securing essential goods for the millions of people across the globe. Logistics companies have made continuous movement between states and cities possible through the networking of ports, suppliers, and manufacturers, in addition to intra-country and last mile deliveries.  Keeping goods and services in motion has gone from being an unceremonious motto to a definite agenda. When Presidents and Prime Ministers comes on to deliver their speeches on how they’re going to send aid here and there, and how they’re going to order this and that for him and her, the task falls on logistics firms to facilitate such orders in a manner that befits the urgency of the situation. When Wuhan was the centre of the COVID discussion back in early February, UPS offered free air freight services to China for millions of face masks and huge quantities of other PPE’s. The toll on our frontline workers is also ongoing. The impact of the work of our brave frontline workers is watered down when we don’t have effective logistics and transportation systems in place to get them what they need on time. According to Satyanarayana Chava, Founder & CEO of Laurus Labs, a leading pharmaceutical company in India, “Logistics are taking longer and freight rates have gone up… this is also leading to shortage of manpower”. A shortage of manpower in Ghanaian places of business was very evident during our recently ended partial lockdown. As with many other sectors across the world, the logistics and transportation sector has taken a peculiar hit such that there has been a simultaneous lack of both supply and demand, in varying degrees. On one hand, the billions of people on lockdown at home or observing social distancing protocols at work ends up creating a lack of the needed levels of logistics services supply to match an increased reliance on delivery services for all the many incoming purchase orders. Then on the other hand, many factories across the globe that utilise logistics and transportation services have shut down, resulting in a lack of demand for logistics and transportation services. Current frustrations of many world leaders with the ordering of test kits and other PPE’s are partially a result of the current difficulties within the logistics and transportation sector. If money is not the problem, then when goods are ordered, then they must be delivered. Yet, as we read early on in this article, logistics is a lot more than just transport. COVID has hit this industry hard and the effects are rippling across the other sectors of industry. Air freight has been a vital part of time-sensitive supply chain and logistics management systems across long distances. With COVID-19 practically bringing the airline industry to its knees, especially for the delivery of vital medical equipment, pharmaceutical supplies and food, airlines have had to resort to using their grounded passenger jets as cargo planes. Luckily enough the lockdowns don’t seem to have had a huge impact on cargo handling as essential goods and services are still open. Availability is relatively stable but demand however seeing an edge. This does have some effect on pricing which is seeing some increases. Certain charges and other economic restrictions have been waived to make room for this. Also, the increase in demand for air freight does mean cargo planes are filled faster. Maritime cargo appears to be harder hit by the pandemic than air cargo. Restrictions in border movements have seen cargo ships locked in other countries in regions such as Europe and Asia. The prices for maritime cargo is also largely stable. Availability tends to be challenging especially with regards to equipment shipment. This definitely has an impact on the logistics and effective planning of some companies that work with heavy machinery. For the vessel chartering market, there appears to be little to no impact. Prices continue to remain stable whilst availability continues as usual. The impact of social distancing rather implies crew management has become a challenge and the possibility of infections and early isolation and quarantine of some crew members have been reported to pose some challenges. Distribution by road freight has very obviously also been affected by the coronavirus pandemic. With lockdowns being in effect across the world in varying degrees, it’s creating a

Coronavirus cannot be Defeated for any of us until it is Defeated for all. The coronavirus has over time proven to not only be a health pandemic, but also a potentially devasting economic catastrophe to billions worldwide. It is the society’s weakest and poorest that are likely to be worst hit. It’s not far-fetched to say that no economy is exempt from the negative impact of another. It’s a global village after all, as advertised. Thus, current times make it stupendously ill-advised to leave Africa’s economy out of conversations on reducing the fiscal impact of COVID-19 now and after we beat it, specifically the threat to the poor and needy. It is no longer a secret that should this coronavirus continue to spread into the coming months, for the poorest of us, the plunge from prosperity to peril will be as swift as the switch to lockdown protocols. The 2020 economic growth rate for the world and that of individual countries have already declined to very low values, implying no improvement in standards and cost of living for those that are already at the bottom of the barrel. That is focus of what you’re about to read, a spotlight on those at the bottom of the barrel and how this pandemic will likely mean much worse for them. Rya Kuewor is the Co-Founder and Executive Director of the Refugee Integration Organization (RIO) and an Agenda Contributor with the World Economic Forum. Simon Turner is a Consultant with the African Health Innovation Center and a Director at Founder Institute. Both are Migrant Reintegration Consultants with SOCIAL IMPACT, an organization that has been instrumental in designing and implementing innovative qualifications and start-up support for socially disadvantaged groups. These are all facts, and this is an opinion piece. Enjoy the read! ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ By Rya Kuewor and Simon Turner While it is fair to say that to some extent COVID-19 doesn’t discriminate, it’s also a given that once it starts to hit the world’s poorest, marginalised and most vulnerable, inequality will yet again prove to be a devastating curse. With little or no access to clean water, shelter, information, healthcare, food, or even the luxury of “social distancing”, the world’s poorest and most vulnerable are at increased risk of suffering the worst from COVID-19. Adding up the 25.9 million refugees living in camps, and the 41.3 million Internally Displaced People (IDPs), as well as the 900 million people who live in the Least Developed Countries (LDCs) – most of which are African nations – over a billion people are at risk and almost 50 countries face the risk of catastrophic failures. The Problem While recognising the importance of learning from other countries like China, Italy, Germany, and South Korea, African leadership and its citizens should not think Africa, as sovereign nations and as a continent, will experience similar timeframes with regards to the time it will take to get a handle on the extent of COVID-19 pandemic. As of today (10 Apr, 2020), there are just over 13,000 recorded cases in the whole of Africa, but celebrating these relatively low numbers as a win would be a mistake, because they are at least partly a result of insufficient testing.  We are also potentially being lulled into a false sense of security by taking as gospel the possibility that the disease is less infective in warmer temperatures. Even if it were the case, “this will be a source of concern for Southern Africa, which is heading into its colder months and “flu season,” and so their healthcare systems – already creaking – will quickly be overwhelmed. The outlook for the rest of the continent is equally bleak, with most countries unprepared to cope with the pandemic for a prolonged time. This coping ability is contingent on how soon robust measures to combat the viral spread are enforced and/or a vaccine or other solution is developed (which is unlikely until before 2021), but most African nations currently cannot effectively implement these measures.    The Impact The public health, economic and social devastation the world has seen in the wake of the COVID-19 pandemic will be many times more severe in developing countries if the viral spread is not contained. In normal times, low-income countries are familiar with poor infrastructure, social amenities and healthcare (not to mention conflict) – with Africa alone carrying a quarter of the world’s disease burden but is responsible for only 1% of global health expenditure – meaning that adding on the ravages of COVID-19 further worsens the situation of many African nations. Africa quite simply is unlikely to be able to follow most of the world in locking down countries and regions to help contain the spread of the Coronavirus. While the US, European, Australasian and Asian countries are able to enforce quarantines, they can also cushion the impacts of the quarantines on their citizens. From direct financial aid to households, to corporate bailouts of up to 2 trillion dollars (in the US), these nations and regions are far better prepared to deal with the pandemic and its immediate aftermath. About 85% of Africans live on less than $5.50 dollars a day, many earning daily wages in low-skilled work. Enforced quarantines and stay-at-home orders will abruptly upend the livelihoods of these people, many of whom do not have the reserve resources to shelter in place. For the people who live hand-to-mouth and in extreme poverty in Africa, many living in shacks and slums with little chance of social distancing, insufficient potable water or sanitation, their communities could easily become a nexus for the viral spread. Because more than a quarter of the world’s hungry live in Africa, the imminent dilemma of either starving or maybe catching COVID-19 will become a bleak reality for many poor families, some of whom may be forced to risk infection.  For some of these vulnerable communities, particularly in refugee camps and for many IDPs, the threat of pandemic is but another of many life-threatening situations they have had to navigate for years. In addition, following how Ebola caused grave stigma against survivors, COVID-19 may engender how survivors or infected persons are treated. Facing the potential for vigilante violence, some already marginalised infected people may decide

Judge Sloss once explained, “A thing is impossible in legal contemplation when it is not practicable; and a thing is impracticable when it can only be done at excessive and unreasonable cost.” It is through the lens of Judge Sloss that I view any discussion on COVID-19 and the pandemic is continuing to have on businesses. It should be universally clear by now that a lot of things previously normal that happen in our lives and our businesses have become impossible or impractical. In my article on COVID-19 & Force Majeure last week, we quoted the Gibson Dunn Law Firm as stating, “Whether or not the contract contains a force majeure clause, the common law doctrines of impossibility or commercial impracticability may be available and legal analysis of such a claim should be conducted… the party asserting this defence will bear the burden of proving that the event was unforeseeable and truly rendered performance impossible, and the doctrine generally is applied narrowly… if an agreement does not have a force majeure or “act of god” clause, an analysis under the doctrine of impossibility or commercial impracticability, depending on the jurisdiction, may be warranted.” Last week’s article triggered some healthy discussions amongst readers and myself. That article had, as I put it, “real gems from a real lawyer and a real law firm”. Today’s article is the content of dialogues with two good friends, one being my proclaimed King of Brainstorming, and the other the man I will credit if ever I take up full-time Pan-Africanism. Foster Awintiti Akugri, the Stanbic Bank Incubator Manager and Founder of Hacklab Foundation, explores how COVID-19 could trigger commercial impracticability for contract holders. Tom Arowojolu is a Director at Mainbridge Group and CEO of Mainbridge Investment Advisory. He touches on what he calls the “Dawn of a New Reality”. Before you read it, I agree with Tom’s assertion that, in legal proceedings and within a legal framework not subject to conspiracy theories and the like, the corona virus cannot be automatically categorized as an “Act of God”.  I say this because, from a legal standpoint, the onus is on whoever is making the claim, be it Force Majeure or Commercial Impracticability, to prove the aforementioned claims. It is going to be very hard to prove that, in these times of advanced modern technology, a virus like this can only be an “Act of God” and not engineered in a lab. Enjoy the read! ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ —- ♕ How COVID-19 could trigger common law doctrines of Commercial Impracticability. Let me start from the national level. The COVID-19 has been so critical to the extent that governments have had to shut down certain arms of its operations in terms of economic activities as a measure to curb the spread. And this has disrupted a lot of value chains and supply chains businesses all over.  Huge sections of the Ghanaian economic community now seem to pose a threat to national security and risk defying the executive order of the President of Ghana if they go about their breadwinning activities as they are used to. So this puts businesses in some form of a shamble where they are caught between “do we fulfil the deal or do we come to a consensus to postpone whatever we may have agreed on or committed to”. And in as much as a contract is a contract, even in the absence of force majeure, some circumstances can make execution impossible or impractical. In this instance, it is an executive order of the President of Ghana, the one person of the highest authority of any economic environment putting an embargo on and limiting some business operations. This may definitely have an impact on some types of businesses and some types of contracts. Let’s take another instance. Assuming I got involved in an accident today or I got paralysed and I am unable to fulfil a certain obligation because of that incident. If I can demonstrate clearly with evidence that it is beyond my control to get my duty done as per a contract, then common law doctrines of commercial impracticabilitycould be enforced.  But again, it depends on how the contract is also drafted. There are a variety of avenues that this may end up taking. Severability Clauses may only allow the courts to void one part of the contract while keeping the other parts very much alive. [Severability Clauses might say, “If any clause, or portion of a clause, in this Agreement is considered invalid under the rule of law, it shall be regarded as stricken while the remainder of this Agreement shall continue to be in full effect”.] Also, keeping in mind that Severability Clauses potentially allow only parts of a contract to be voided, everything that’s happening with these lockdowns other COVID-19 situations do not necessarily make contracts automatically void when the common law doctrines of commercial impracticability is enforced. You may consider giving an extension to the other party or suspending the activity until both of you have agreed on something. But it also gives the right to one party to terminate the contract. This becomes the much more complex part of it, which in this circumstance is the impact of why you are writing this article right? To seek the opinions of your readers as to whether people can take advantage of these circumstances to get out of contracts. [At this point I interjected that “Advantage” is a strong word: this is more like the exploration of an option that readers requested I delve into after reading a little about it in the closing paragraph of my last article on ‘COVID-19 & Force Majeure’. Foster continued…” Ok, then let me rephrase it as this is explore considerations to taking precautions in light of the complications of COVID-19 to renegotiate contracts which they were initially tied to and now seem to have no option than to fulfil them. Most people have Force Majeure clauses in their contracts though which addresses pandemics. And technically, this is a pandemic. So terrorism, earthquakes, hurricanes, acts of governments, plagues and/or epidemics are usually what’s mentioned in Force Majeure clauses.