Africa’s GDP could fall by 3.4% in 2020 if COVID-19 continues – AfDB

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The bank warns projected GDP losses for 2021 ranges from $27.6 billion to $47 billion.

The African Development Bank (AFDB) published its African Economic Outlook 20202 Supplement on Tuesday and warned that the continent’s GDP would fall by at least 1.7%, and if the coronavirus pandemic continues into the second half of 2020, it could contract up to 3.4%. 

“Real GDP in Africa is projected to contract by 1.7% in 2020, dropping by 5.6 percentage points from the January 2020 pre-COVID-19 projection of the virus, if the virus has a substantial impact but of short duration. If it continues beyond the first half of 2020, there would be a deeper GDP contraction in 20202 of 3.4% down by 7.3 percentage points from growth projected before the outbreak of COVID-19,” the bank said. 

AFDB warns that cumulative GDP losses could range between $173.1 billion and $236.7 billion in 2020-2021. 

“Africa could suffer GDP losses in 20202 between $145.5 billion (baseline) and $189.7 billion (worst case) from the pre-COVID-19 estimated GDP of $2.59 trillion for 2020”. 

The bank warned some losses will be carried over into 2021, as the projected recovery would be partial, and warns projected GDP losses for 2021 ranges from $27.6 billion to $47 billion (worst case).

The bank said countries with poor healthcare systems, oil-exporting nations, tourism-dependent nations, and other resource-dependent nations will be the hardest hit. 

The African Development Bank (AFDB) published its African Economic Outlook 20202 Supplement on Tuesday and warned that the continent’s GDP would fall by at least 1.7%, and if the coronavirus pandemic continues into the second half of 2020, it could contract up to 3.4%.

“Real GDP in Africa is projected to contract by 1.7% in 2020, dropping by 5.6 percentage points from the January 2020 pre-COVID-19 projection of the virus, if the virus has a substantial impact but of short duration. If it continues beyond the first half of 2020, there would be a deeper GDP contraction in 20202 of 3.4% down by 7.3 percentage points from growth projected before the outbreak of COVID-19,” the bank said.

AFDB warns that cumulative GDP losses could range between $173.1 billion and $236.7 billion in 2020-2021.

“Africa could suffer GDP losses in 20202 between $145.5 billion (baseline) and $189.7 billion (worst case) from the pre-COVID-19 estimated GDP of $2.59 trillion for 2020”. 

The bank warned some losses will be carried over into 2021, as the projected recovery would be partial, and warns projected GDP losses for 2021 ranges from $27.6 billion to $47 billion (worst case).

The bank said countries with poor healthcare systems, oil-exporting nations, tourism-dependent nations and other resource-dependent nations will be the hardest hit.

The bank calls for countries to reopen economies and advised a “phased and incremental approach that carefully evaluates the trade-off between restarting economic activity to quickly and safeguarding the health of the population”. 

The Economic Outlook Supplement is a revised projection from an earlier January outlook that projected 3.9% growth from Africa’s largest multilateral bank.

Source: nairametrics.com

 

 

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