There are now nearly 10,000 confirmed coronavirus cases in 51 African nations, with the Africa Centres for Disease Control and Prevention reporting 442 fatalities as of Monday.
Yet as the global pandemic continues to impact the continent, there’s growing concern over the economic impacts as well. A newly released report from the African Union warns a drop in crude oil prices measured at 54 percent since the start of the year, as well as prices of other commodities, will affect nearly all African nations.
“Cocoa has lost 21 percent of its value in the last five days,” the report says, even as the cost of rice, wheat and other food imports upon which Africans rely has continued to rise.
“Some key sectors of the African economy are already experiencing a slowdown as a result of the pandemic,” said the AU. “Tourism, air transport, and the oil sector are visibly impacted. However, invisible impacts of Covid-19 are expected in 2020 regardless of the duration of the pandemic.”
It’s unlikely that the 3.4 percent economic growth rate for the continent, forecast last year by the African Development Bank, will be achieved because of the COVID 19 crisis, and new models show negative values.
“Exports and imports of African countries are projected to drop by at least 35 percent from the level reached in 2019,” the AU explains. The loss in value is estimated at around US$270 billion, while the fight against the coronavirus itself is expected to cost an estimated $130 billion.
“Even if African countries are relatively less affected compared to other regions for now, the spillover effects from global developments or broken supply chains may still lead to faltering economic activity,” the report concludes.
“Indeed, the high dependency of African economies vis-à-vis foreign economies predicts a negative economic spinoff for the continent, evaluated at an average loss of 1.5 points on economic growth 2020.”
The complete AU report is available at this link.