Sub-Saharan Africa is facing an unprecedented health and economic crisis. One that threatens to reverse the development progress of recent years. Furthermore, by exacting a heavy human toll, upending livelihoods, and damaging business and government balance sheets, the crisis threatens to slow the region’s growth prospects for years to come.
Comprehensive measures are needed to limit humanitarian and economic losses. Despite the limited space going into the crisis, timely fiscal support is crucial to protect vulnerable groups and ensure a quick recovery when the pandemic fades.
“The ability of sub-Saharan African countries to mount the necessary fiscal response will require ample external financing on grant and concessional terms from the international community,” says AbebeAemro Selassie, Director of the IMF’s African Department.
Here are six charts that tell the story:
• COVID-19 threatens to unleash an unprecedented health crisis in sub-Saharan Africa. As of April 13, over 7,800 cases of COVID-19 have been confirmed across 43 countries in the region. South Africa, Cameroon, and Burkina Faso are the most affected. The rapid spread of the virus, if left unchecked, threatens to overwhelm weak healthcare systems and exact a large humanitarian toll.
• The health shock is precipitating an economic crisis and upending the livelihoods of already vulnerable groups. Containment and mitigation measures needed to slow the spread of the virus will severely impact economic activity.Furthermore, a lockdown can have devastating effects—for example, on food insecurity—on households who live hand-to-mouth and have limited access to social safety nets.
• Spillovers from a rapidly deteriorating external environment are compounding the economic challenges facing sub-Saharan Africa. A sharp growth slowdown among key trading partners is reducing external demand. In addition, tightening global financial conditions are reducing investment flows and adding to external pressures. Finally, a sharp decline in commodity prices, especially oil, is exacerbating challenges in some of the region’s largest, resource-intensive economies.