The President of the Africa Development Bank (AfDB) Dr. Akinwumi A. Adesina has indicated that Africa will need colossal amounts to tackle the devastating effects of COVID-19 pandemic and the Russia-Ukraine war.
“Africa will need at least US$432 billion to address the effects of COVID-19 on its economies and on the lives of its people — resources it does not have”, he stated, warning that the recovery of African economies will still be costly.
The 2022 African Economic Outlook released by the AfDB on Wednesday indicated that continent’s gross domestic product has recovered strongly in the last year.
However, the protracted effects of the COVID-19 pandemic, Russia’s invasion of Ukraine and the ensuing war could pose considerable challenges in the medium term.
Africa’s gross domestic product grew by an estimated 6.9% in 2021 after the continent suffered a pandemic-induced contraction of 1.6% in 2020.
The report pointed out that rising oil prices and global demand have generally helped improve Africa’s macroeconomic fundamentals.
Regrettably, growth could decelerate to 4.1% in 2022, and remain stuck there in 2023, because of the prolonged pandemic and inflationary pressures caused by the Russia-Ukraine war.
Both countries are major grain suppliers to Africa.
The AfDB Group has responded to the likelihood of a looming food crisis with a US$1.5 billion African Emergency Food Production Facility approved by the Group’s executive board last week.
President of AfDB, Dr Akinwumi Adesina, said international efforts, including those of the African Development Bank Group, the G20 Common Framework for Debt Treatment, and the US$650 billion in Special Drawing Rights issued by the International Monetary Fund, are supporting the continent’s recovery.
The theme of the 2022 African Economic Outlook is “Supporting Climate Resilience and a Just Energy Transition in Africa.”
It highlights a growing threat to lives and livelihoods in Africa.
The Bank launched the report during its Group Annual Meetings in Accra, Ghana on the same the same theme.
The acting chief economist and Vice President for the Economic Governance and Knowledge Management Complex, Prof. Kevin Chika Urama said, “Climate change is the most existential challenge to Africa’s development today. Finding policies that address climate adaptation and mitigation of greenhouse gas emissions while ensuring social and economic development is one of the most enduring policy challenges of our time”, Prof. Urama stated.
He added that, “The African Economic Outlook report 2022 provides evidence-based policy options for driving inclusive growth by building climate resilience and a just energy transition in Africa.”
The African Economic Outlook makes it clear that the pandemic and Russia-Ukraine war could leave a lasting impression over several years, if not as much as a decade.
Meanwhile, around 30 million people in Africa were pushed into extreme poverty in 2021 and about 22 million jobs were lost in the same year because of the pandemic.
This trend is expected to continue through this second half of 2022 and on into 2023.
The economic disruptions stemming from the Russia-Ukraine war could push a further 1.8 million people across the African continent into extreme poverty in 2022. That number could swell with another 2.1 million in 2023.
The continent’s additional financing needs for 2020-22 are estimated at $432 billion.
