Africa’s Economic Growth To Fall By 4.1% In 2020, To Rise By 5% In 2021 — UN

The United Nations (UN) has disclosed that Africa’s economy will decline by 4.1% in 2020 due to the effects of COVID- pandemic and it’s expected to jump back by 5% in 2021.

Brandnewsday understands that this was made known by the UN Economic Commission for Africa (ECA) in a report on Tuesday. The report was titled: “Innovative finance for private sector development in Africa,” noted that Africa will need US$44 billion for the testing, personal protective equipment for frontline medical staff, equipment and treatment of the coronavirus.

The UN revealed that for Africa’s economy to bounce back it would need effective policies to fight the ravaging pandemic, alongside the effect of global actions to rattle the bars of the deadly coronavirus.

In the report, it forecasted that Africa spending will increase to their health systems and absorb costs related to the COVID-19 lockdowns.

Meanwhile, Africa will need US$44 billion for the testing, treatment and hospitalization of Covid-19 index patients.

According to ECA projection, the pandemic will force between 5 to 29 million people into extreme poverty compared with a baseline 2020 African growth scenario.

READ: World Bank Gifts $1.5billion Loan To Nigeria To Fight Poverty

United Nations

The UN called for more investment in African infrastructure and innovation, reiterating that poor innovation is affecting Africa’s productions abilities and reduced education quality.

Moving further, the United Nations revealed that the estimated financing gap is US$2.5 trillion for all emerging and developing countries and US$200billion to US$1.3trillion for Africa and urges the continent to invest in human capital to bridge the gap.

Also, it added that due to Africa’s population growth of 43% over 2015–2030, the gap could reach US$19.5 trillion by 2030.

UN said Africa had the second-fastest growing economy in the world in 2019, however, the pandemic would affect growth between 1.8% and -4.1% in 2020.

The UN calls for more banking reforms to reduce the effects of monetary crisis, and also to boost private sector-led investment in the continent through stronger equity and debt capital.

Recall that the World Bank had stated that the second wave of the coronavirus pandemic could make an additional 5 million Nigerians poor, given the imminent recession which is expected to be the worst since the 1980s.

The President of the World Bank Group, David Malpass, revealed that the bank needs to spend at least $70 billion per year to tackle the impact of the pandemic induced poverty.