- A new World Bank report shows that sub-Saharan Africa could be headed for a recession for the first time in 25 years
- The report also shows that the region’s Gross Domestic Product (GDP) is likely to contract between 2.1% and 5.1% in the year 2020
- It also reveals that the coronavirus could cost sub-Saharan Africa between $37 billion and $79 billion in output losses
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A new World Bank report shows that sub-Saharan Africa is likely to record its first recession in 25 years.
The observation comes at a time when the coronavirus has slowed down economic activities and disrupted trade all over the world.
The report shows that the region’s Gross Domestic Product (GDP) is likely to contract between 2.1% and 5.1% in 2020; economic growth was 2.4% in the year 2019.
Per a report by Bloomberg, the statement added that the outbreak is testing the limits of societies and economies around the world.
READ ALSO: Finance minister Ken Ofori-Atta urges China to support Africa with debt reliefs
It went on to say that African countries are likely to be the hardest hit by the coronavirus.
The report further indicated that the fall in growth is fuelled by a sharp decline in output in key trading partners such as China and the Euro area.
It also listed falling commodity prices, reduced tourism, and emergency measures taken to contain the virus.
The World Bank report estimates that the epidemic could cost sub-Saharan Africa between $37 billion and $79 billion in output losses.
This has been blamed on disruption to trade and value chains, reduced foreign investment and aid.
The region’s three biggest economies, Nigeria, South Africa and Angola, have also been severely affected.
The report says it compounds the already existing challenges of weak growth and decline in prices of oil and other commodities.
In other news, the International Monetary Fund (IMF) has approved an extension of time for Ghana and other borrowers to repay debts owed.
The IMF intends to give the countries in question ample time to support their economic activities as the world battles the coronavirus.
Ghana has already applied for funds from the IMF and this was approved after which $500 million was made available.
READ ALSO: Akufo-Addo predicts Ghana's growth rate could fall from 7% to 2.5%
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