Amid Recession, Sub-Saharan Africa Poised for Recovery

ADDIS ABABA – Economic growth in Sub-Saharan Africa is estimated to have contracted by 2.0% in 2020, closer to the lower bound of the forecast in April 2020, according to World Bank’s report.

The prospects for recovery, however, are strengthening amid actions to contain new waves of the pandemic and speed up vaccine rollouts, says the Bank’s biannual economic analysis for the region released this week.



A slower spread of the virus and lower COVID-19-related mortality, strong agricultural growth, and a faster-than-expected recovery in commodity prices has helped many African economies weather the economic storm induced by the COVID-19 pandemic, claims the latest Africa’s Pulse notes.

Nonetheless, the region suffered its first recession in over 25 years, with activity
contracting by nearly 5.0 percent on a per capita basis.

The Bank says economic recovery hinges on countries deepening reforms that create jobs, encourage investment, and enhance competitiveness.

‘Next move key’

“African countries have made tremendous investments over the last year to keep their economies afloat and protect the lives and livelihoods of their people,” said Albert G. Zeufack, World Bank Chief Economist for Africa.

“Ambitious reforms that support job creation, strengthen equitable growth, protect the vulnerable and contribute to environmental sustainability will be key to bolstering those efforts going forward toward a stronger recovery across the African continent,” the economist added.

Growth in the region is forecast to rise between 2.3 and 3.4% in 2021, depending on the policies adopted by countries and the international community.

The second wave of COVID-19 infections is partly dragging down the 2021 growth projections, with daily infections about 40% higher than during the first wave.

While some countries had a significant drop in COVID-19 infections due to containment measures adopted by the government, other countries are facing an upward trend in infections.

For most countries in the region, activity will remain well below the pre-COVID-19 projections at the end of 2021, increasing the risk of long-lasting damage from the pandemic on people’s living standards.

Real GDP growth for 2022 is estimated at 3.1%, according to the Bank’s report.

‘Varying recoveries’

According to the report, non-resource-intensive countries, such as Côte d’Ivoire and Kenya, and mining-dependent economies, such as Botswana and Guinea, are expected to see robust growth in 2021.

It will be driven by a rebound in private consumption and investment as confidence strengthens and exports increase, it says/

In the Eastern and Southern Africa sub-region, the growth contraction for 2020 is estimated at -3.0%, mostly driven by South Africa and Angola, the subregion’s largest economies.

Excluding Angola and South Africa, economic activity in the sub-region is projected to expand by 2.6% in 2021, and 4.0% in 2022, it added.

Cost of ‘Uncertainty’ in Ethiopia

The report says that the economic impact of the pandemic was felt late in the 2019/20 fiscal year in Ethiopia, resulting in relatively robust growth of 6.1 percent.

But the adverse effects of the pandemic intensified in FY2020/21, according to the report.

The report projects for Ethiopia’s economy to expand moderately and show a 2.3 percent growth in FY2021, reflecting “a slowdown in domestic demand amid heightened political uncertainty”.

Elsewhere, real gross domestic product in the Western and Central Africa sub-region is projected to grow 2.1% in 2021 and 3.0% in 2022.

The Pulse also notes that African countries can speed up their recovery by ramping up their existing efforts to support the economy and people in the near term, especially women, youth, and other vulnerable groups.

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