(4 minutes read)
· Sub-Saharan Africa, according to the International Monetary
Fund (IMF), is in the brink of a recession that will spread to all
countries in the region on account of the Covid-19 health crisis.
· World Bank chief economist for Africa, Albert Zeufack says
that GDPs of largest economies in the region- Nigeria, Angola and
South Africa-will take a deep haircut, fuelling recessionary trends,
across the region.
Sub-Saharan Africa, according to the International Monetary Fund
(IMF), is on the brink of a recession that will spread to all
countries in the region on account of the Covid-19 health crisis. The
early signs of recession are already there on the horizon, according
to Aemro Selassie, director of the IMF’s African Department.
Importantly, the World Bank also shares the same view and maintains
that no country in the region will be spared of the recession.
World Bank chief economist for Africa, Albert Zeufack says that GDPs
of largest economies in the region- Nigeria, Angola and South
Africa-will take a deep haircut, fuelling recessionary trends, across
the region.
The region’s gross domestic product is expected to contract by 1.6
percent in 2020, a downward revision of 5.2 percentage points from
predictions made six months ago, according to the IMF in its latest
regional outlook plan for the sub-Saharan region. Mentioning that the
situation requires bold decisions, the IMF official said that the
capital inflows would dry down, drastically coupled with decline in
oil revenues for Nigeria and Angola, two largest oil producers in the
region. In the last year’s outlook, the FDI flow into the region
looked up, despite the world capital flows decelerating.
Calling for prioritizing health spending regardless of debt levels,
cash transfers for the most vulnerable groups and financially
hard-hit small- and medium-sized businesses, IMF said that the
financial needs for such expenditure should be found mostly from the
domestic resources.
As of April 13, over 7,800 cases of COVID-19 have been confirmed
across 43 countries in the region. The hotspot countries are South
Africa, Cameroon, and Burkina Faso, which have the maximum number of
infected people and death toll.
The report also says that the countries in the region for that matter
in the continent do not have the comfort of lockdown for an
unprecedented time since the teeming millions particularly in the
informal sector would be left without food, if the pandemic continues
unabated. An average African does not have the comfort of a fridge, if
he or she manages to buy things in bulk to avoid visiting crowded
markets often to keep away from the fear of the contagion.
