African Economy and COVID-19: A battle for economic survival

According to data from Africa Centres for Disease Control and Prevention (Africa CDC), the total number of confirmed COVID-19 cases in Africa as at the end of April 1, stood at 6,213 across 49 African countries with 221 deaths and 469 recoveries. Also, the regional analysis showed that the highest cases have been recorded in the Northern African region trailed by the Southern and Western regions, respectively.

Notably, in a bid to curtail the virus from spreading further, African leaders have had to implement pre-emptive restrictions on travel and mass gatherings. Specifically, data from the Africa CDC showed that 51 of 55 African countries have implemented some forms of travel restrictions (in and out if the countries), while media reports indicate that up to 10 African countries (inclusive of Nigeria and South Africa) have had to shut down commercial activities in the States that have been hugely impacted by the virus. Elsewhere, monetary authorities across the region have had to roll out an extensive stimulus package to reverse some of the economic damage of the crisis.

Overall, any hope of strong economic growth in 2020 is now gone as survival becomes the new watchword. Notably, the UN’s Economic Commission for Africa reckons the continent’s average GDP growth rate ill fall to 1.8% this year from 3.2%. In our opinion, such projection still looks optimistic from where we stand today as the outbreak is expected to peak around Q2-2020.

United Capital Research