The bank estimates “Covid-19 will cost the region between $37 billion and $79 billion in output losses for 2020 due to a combination of effects,” including trade disruption and reduced remittances, tourism and foreign aid.
While most countries in the region will see a decline in growth, “real gross domestic product growth is projected to fall sharply particularly in the region’s three largest economies — Nigeria, Angola, and South Africa — as a result of persistently weak growth and investment,” the report said.
The bank also warned of a potential food security crisis in Africa as a result of disrupted agricultural production and food imports.
While several African countries swiftly implemented measures to curb the spread of the outbreak, the report identified “several factors that pose challenges to the containment and mitigation measures, in particular the large and densely populated urban informal settlements, poor access to safe water and sanitation facilities, and fragile health systems.”
“There is no doubt there will be need for some sort of debt relief from bilateral creditors to secure the resources urgently needed to fight Covid-19 and to help manage or maintain macroeconomic stability in the region,” said Cesar Calderon, lead economist and lead author of the report, in a statement from the World Bank.