Sub-Saharan Africa is set for an uneven economic recovery this year as some countries struggle to bring coronavirus infections under control, according to the World Bank.
Gross domestic product will probably grow between 2.3% and 3.4% in 2021, after contracting 2% last year, on stronger agricultural growth and a faster-than-expected recovery in commodity prices, the Washington-based lender said in an emailed copy of its Africa Pulse report Wednesday.
“There’s a clear rebound in consumption and investment confidence returning to countries that have managed to contain the virus,” the bank’s Chief Economist Albert Zeufack said in a virtual briefing on Wednesday.
Africa’s largest economies, Nigeria, Angola and South Africa, will be back to positive growth in 2021 while countries like Ivory Coast, Kenya, Botswana and Guinea that are riding on a mineral price wave will be growing way faster in 2021 and 2022, Zeufack said.
New infections are weighing on growth projections as daily cases have been about 40% higher during in a second wave of infections. Economic activity will remain well below pre-Covid-19 projections in a majority of the countries in the region, increasing the risk of long-lasting damage from the pandemic on people’s living standards, the World Bank said.
Governments will need to do more to “support job creation, strengthen equitable growth, protect the vulnerable,” and the environment, Zeufack said in a statement accompanying the report. Faster progress on vaccine deployment along with credible policies to stimulate private investment would accelerate growth.
Sub-Saharan Africa’s outlook also depends on debt suspension. Several countries in the region have signed up to the so-called common framework on debt relief put together by the Group of 20 nations.
“We’re hoping to see more innovation including a new issuance of the IMF special drawing rights that could actually avail some fiscal space for African countries to weather the pandemic and really sustain the kind of growth rates we have estimated,” Zeufack said.
Sub-Saharan Africa will grow by an estimated 4.5% in 2022 provided a rebound in consumption and investment continue, according to the report. Bloomberg
— With assistance by Alonso Soto(Updates with comments from World Bank virtual briefing throughout.)