Uche Usim, Abuja
The African Development Bank (AfDB) has released its Economic Outlook for 2020, projecting that Nigeria, Ghana and other countries on the continent will collectively lose $236.7 billion Gross Domestic Product (GDP) to the rampaging COVID-19 pestilence.
The report, unveiled on Tuesday, explained that Real GDP in Africa to contract by 1.7 per cent in 2020, dropping by 5.6 percentage points from the January 2020 pre-Covid–19 projection, if the virus has a substantial impact but of short duration.
It maintained that if the scourge and its concomitant health crisis were not curtailed by the first half of 2020, there would be a deeper GDP contraction in 2020 of 3.4 per cent, down by 7.3 percentage points from the growth projected before the outbreak of COVID-19.
Summarizing the development, AfDB inferred that GDP losses could range between $173.1 billion and $236.7 billion in 2020–2021.
With the projected contraction of growth, the bank in the report stated that Africa could suffer GDP losses in 2020 between $145.5bn (baseline) and $189.7bn (worst case), from the pre-coronavirus estimated GDP of $2.59 trillion for 2020.
It noted that some losses would be carried over to 2021, since the projected recovery would be partial.
For the 2021 fiscal period, the AfDB projected that GDP losses could move from $27.6 billion (baseline) up to $47 billion (worst case) from the potential GDP of $2.76 trillion without the pandemic.
According to the bank, the most affected economies would be those with poor healthcare systems, as well as countries that rely heavily on tourism, international trade, and commodity exports.
It added that those African countries with high debt burdens and high dependence on volatile international financial flows could also be greatly affected by the negative impact of the pandemic.
The report stated, “The overall impact of the pandemic on socioeconomic outcomes remains uncertain, however.
“It will depend crucially on the unfolding epidemiology of the virus, the extent of its impacts on demand and supply, the effectiveness of public policy responses, and the persistence of behavioral changes.”
The pandemic had triggered a sudden uptick in inflation in the continent, in some cases
by more than five per cent in the first quarter of 2020.