Sub-Saharan Africa ‘faces food crisis ’
• World Bank forecasts plunge in GDP growth, particularly in three largest economies Nigeria, Angola and SA
Sub-Saharan Africa’s economies could lose as much as $79bn in output in 2020 due to the coronavirus epidemic, a World Bank report says. This could lead to a severe food security crisis, with agricultural production expected to contract between 2.6% and 7%.
Sub-Saharan Africa’s economies could lose as much as $79bn (about R1.42-trillion) in output in 2020 due to Covid-19, a World Bank report says.
This could lead to a severe food security crisis, with agricultural production expected to contract between 2.6% and 7%.
The pandemic continues to wreak havoc across the globe, bringing most economies to a standstill as governments enact stringent measures to limit the movement of people to curb the spread of the disease.
Economists predict the pandemic will cause a global recession worse than that of the 2008/2009 financial crisis.
President Cyril Ramaphosa ordered a national lockdown until April 16 as the country struggled to curb the spread of the virus, which has infected more than 1.8-million people and killed at least 118,000. As of Monday, the virus in SA had infected 2,272 and killed 27.
Last week Ramaphosa announced an extension of the lockdown by two weeks.
According to the World Bank’s report, titled “Africa’s Pulse”, while most countries in the region have been affected to different degrees by the pandemic, real GDP growth is projected to fall sharply, particularly in the three largest economies — Nigeria, Angola, and SA — as a result of persistently weak growth and investment.
In general, oil-exporting-countries will also be hard hit. Growth is also expected to weaken substantially in the two fastest-growing areas — the Economic Community of West African States and the East African Community — due to weak external demand and disruptions to supply chains and domestic production. The region’s tourism sector is expected to contract sharply due to severe travel disruptions.
The World Bank says the coronavirus will cost the region between $37bn and $79bn in output losses for 2020 due to a combination of factors. These include trade and value chain disruption, which affects commodity exporters and countries with strong value chain participation; reduced foreign financial flows from remittances, tourism, foreign direct investment and foreign aid, combined with capital flight; and through direct effects on health systems, and disruptions caused by containment measures and the public response.
The pandemic also has the potential to spark a food security crisis in Africa, with agricultural production potentially contracting between 2.6% in an optimistic scenario and up to 7% if there are trade blockages, the authors write. Food imports will decline substantially (by as much as 25% or as little as 13%) due to a combination of higher transaction costs and reduced domestic demand.
The World Bank said it will be taking broad, fast action to help developing countries strengthen their response to the pandemic, increase disease surveillance, improve public health interventions, and help the private sector continue to operate and sustain jobs. It is deploying up to $160bn in financial support over the next 15 months to help countries protect the poor and vulnerable, support businesses and bolster economic recovery.
“The Covid-19 pandemic is testing the limits of societies and economies across the world, and African countries are likely to be hit particularly hard,” Hafez Ghanem, World Bank vicepresident for Africa, said.
He said the global development lender is rallying resources to help countries meet people’s immediate health and survival needs while also safeguarding livelihoods and jobs — and is also calling for a standstill on official bilateral debt service payments. This would free up funds to strengthen health systems and save lives; secure social safety nets to save livelihoods and help workers who lose jobs; support small and medium enterprises; and help secure food security.
The World Bank recommends that African policymakers focus on saving lives and protecting livelihoods by strengthening health systems and taking quick action to minimise disruptions in food supply chains. It is also suggested that leaders implement social protection programmes — including cash transfers, food distribution and fee waivers — to support citizens.