Published: September 25, 2020
While sub-Saharan Africa has been devastated by the coronavirus, some countries have been hit harder than others and the prospects for recovery across the continent are mixed.
The Covid-19 pandemic has caused turmoil across the globe, with hundreds of thousands of lives lost and many countries forced into lockdown. It has also caused macroeconomic disruption, with the world entering the biggest downturn since the Great Depression.
Emerging economies are likely to be hit particularly badly. According to World Bank data, Sub-Saharan Africa is expected to suffer its first recession in 25 years, plunging by between 2.1% and 5.1% this year and breaking a stretch of uninterrupted growth.
It’s a bleak picture without much in the way of bright spots. As Kenny Fihla, chief executive for corporate and investment banking at Standard Bank remarks, many African economies have been devastated by the pandemic.
“Before Covid-19, we anticipated that sub-Saharan African GDP would grow by about 3.2% to 3.5% this year, but following Covid all of that has changed,” Fihla tells EMEA Finance. “The South African economy is projected to shrink by 6.5 to 8.5% this year, so that’s a very steep reduction. West Africa is likely to have a mixed picture, with the Nigerian economy expected to shrink by about 3% or so in a less severe scenario. The only region that is not projected to shrink is East Africa, which is projected to grow by just over 1%, compared to 6% last year.”
He adds that the worst hit African countries are the ones most reliant on global trade. For the likes of Nigeria, South Africa and Angola,