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Emerging from Covid-19: Scenarios for Africa
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Economic & Financial Crises
- African countries have imposed harsh lockdowns to stop the spread of Covid-19.
- These lockdowns immediately worsen the livelihoods of poor urban households working in the informal sector, who are in urgent need of (temporary) social assistance.
- The expected downturn in industrialized and emerging economies will adversely affect African countries, e.g. via falling demand for commodities and lower revenue from tourism.
- Even though initial conditions vary considerably across the continent, most African countries are expected to experience a recession, and one projection suggests that 80 million more people could fall into extreme poverty which means a 23 percent increase.
- African governments can speed up the recovery from the crisis, e.g. by proceeding with the African Continental Free Trade Area (ACFTA) which might partially cushion against shortfalls from severed global trade links.
- International organizations and donor countries should step up support for African countries to help them curb the economic and social fallout of Covid-19.
