The Covid-19 pandemic has driven an estimated 30 million people in sub-Saharan Africa into extreme poverty, according to a report released on Wednesday at the ongoing Bloomberg New Economy Forum in Singapore.
The report titled Long Covid: Jobs, Prices and Growth in the Enduring Pandemic
finds that the pandemic had wiped out more than five years of progress in the region.
It warns that whilst some ground will be made as African economies recover, this will still not be enough to meet the United Nations’ Sustainable Development Goal of eradicating poverty by 2030 – a target that was already a stretch before the pandemic hit.
African economies had promising spells by the turn of the century, witnessing an upward trajectory due to reduced conflict, allowing for better economic policies and increased macroeconomic stability, it says.
“The International Monetary Fund and World Bank’s Heavily Indebted Poor Country Initiative in the early 2000s led to substantial reduction in debt levels, freeing up domestic resources and improving donor relations. Increased trade and buoyant commodity prices also played a role, with GDP per capita in resource-rich countries growing twice as fast” it adds.
“This resulted in better living standards for the populations — people became healthier, access to basic services such as water and sanitation improved, school enrolment increased, and the share of people living below the World Bank’s extreme poverty line of $1.90 per day fell from 58% in 2000 to 42% by 2015.
According to the report, growth began to falter by 2016, a year after the adoption of the Sustainable Development Goals — the universal clarion call to eradicate poverty by 2030 through progress on 17 integrated goals that range from health, education, inequality and climate change.
“Sub-Saharan Africa continues to lag behind on most of the goals. Most notable is the lag on poverty reduction; before the pandemic in 2019, Africa had more than 60% of the world’s 700 million poor” it explains.
The Covid-19 pandemic threatens to throw the region further behind.
In 2020, sub-Saharan Africa plunged into its first recession in more than 25 years, erasing at least five years of progress in fighting poverty.
The report quotes economists as forecasting that this lost ground won’t be recovered until 2024, when per capita output is expected to return to its pre-pandemic levels.
“Sluggish vaccine rollout means many countries will continue to deal with virus outbreaks that delay the safe reopening of their economies. Rising debt service costs will continue to squeeze out much-needed development spending even when the virus effects fade” it adds.
It says the persistent impact of the pandemic on incomes means the poverty rate would translate into almost 25 million more people living in poverty, compared with pre-Covid estimates.
It suggests that making notable progress on poverty eradication, will require Africa to garner immense support from the international community given the continent’s limited resources.
“To address this gap, funding from official creditors including the IMF, the largest providers of external debt, remain crucial for sub-Saharan Africa.
The Bloomberg New Economy Forum which began in Singapore on Tuesday brings together
over 495 participants including public and private sector leaders from around the world, including representatives from Africa to contribute to new thinking on pathways toward a global recovery as the world reels from the impact of the COVID-19 pandemic.
WN/as/APA