Sub-Saharan Africa’s slump may last three years, Ofori-Atta says

Much of the region has been spared the infection and death rates which have hit other parts of the world, but its economies have been damaged by the pandemic

The economic slump in sub-Saharan Africa caused by the novel coronavirus outbreak could last well over three years, Ken Ofori-Atta, Minister for Finance has said.

“We are in the middle of the first recession in sub-Saharan Africa in the last 25 years,” Ofori-Atta said.

The slump may last well over three years and could push between 26 and 39 million people continent-wide into extreme poverty, he said.

“Many of our economies are facing economic contractions of up to 15% of gross domestic product and severe liquidity challenges,” he added.

Ofori-Atta, who also serves as the chairman of the African Development Bank’s (AfDB) board of governors, was speaking during the swearing-in of the AfDB president, Akinwumi Adesina, to a second five-year term.

Grateful to all

In his inauguration speech, Akinwumi Adesina said: “Four days ago, on 27 August 2020, I was re-elected as president of the African Development Bank Group. I wish to thank you all for your incredible support and for the mark of confidence you all collectively placed in me.

“You elected me with 100% of all the votes of regional and non-regional shareholders of the Bank – without any exception. This is unparalleled in the bank’s 56-year history. And for this, I am exceedingly grateful.”

He added: “You, our shareholders, have showcased the African Development Bank’s exceptionally high standards and its commitment to transparency and good corporate governance. I am deeply grateful for your collective trust, confidence and support. Above all, I am greatly honoured – and humbled.

Renewed vision

“Today, a rainbow stretches from the 81 member countries of the African Development Bank across the deep blue skies of Africa, with one message – the rain is gone. Gone are the dark clouds that held us down.”

Adesina outlined a renewed vision to build a much stronger and resilient African Development Bank Group, with the leadership and capacity to deliver greater-quality impacts for Africa, while remaining financially strong and sustainable.

To achieve this, Adesina said he would focus on building a stronger institution, strengthen human capacity, enhance effectiveness, deepen quality and impact and maintain financial sustainability.

Partial rebound

The AfDB said in July it expected Africa’s economy to rebound partially next year, but that it could still lose nearly a quarter of a trillion dollars in output over 2020 and 2021.

African countries have recorded nearly 1.25 million COVID-19 infections and almost 30,000 deaths.

Their relatively low caseloads have been attributed to their relative isolation, early preventive measures taken by government and health officials, and limited testing which suggests the true infection rates are higher.

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