ADDIS ABABA – Africa’s economy will rebound from the impact of the COVID-19 pandemic and achieve a modest recovery this year, according to a report released by the UN Economic Commission for Africa (UNECA) on Wednesday.
“After a contraction of 3.4% in 2020, Africa’s GDP is projected to expand by 3.4% in 2021,” Bartholomew Armah, a top UNECA official, said while presenting the 2021 World Economic Situation and Prospects (WESP) Report in a virtual conference.
According to the report, the continent’s GDP will grow 3.6% in 2022.
“Nigeria’s GDP is projected to expand by 1.5% in 2021 after a contraction of 3.5% in 2020; in South Africa, GDP is projected to expand by 2.3% in 2021 after a contraction of 7.7% in 2020,” he said.
Ethiopia’s economy contracted 0.5% last year and is expected to grow 2.3% this year, he added.
“In Egypt, the 3.5% positive growth in 2020 is projected to decline to 2.3% in 2021,” Armah said.
The official said countries’ liquidity and ability to vaccinate large portions of their population will prove pivotal in efforts to secure an economic turnaround.
“Access to vaccines and capacity to vaccinate are critical,” he stressed.
Armah said the $650 billion in special drawing rights offered by G7 countries will help African countries currently reeling under the burden of debt.
“There are downside risks to the outlook. The challenges related to external financing and high debt levels pose a major risk,” he added.
“African countries need further support from the international community in averting a debt crisis, protracted low growth, and a high debt trap.”
Such conditions have the potential to rapidly worsen, he explained.
“Against such a backdrop, social unrest and political tensions may easily escalate, which could increase insecurity, violence, internal displacement, migration and food insecurity,” Armah warned.
The 2021 WESP report has been jointly produced by UNECA, UN Department of Economic and Social Affairs, UN Conference on Trade and Development, the five UN regional commissions, and the UN World Tourism Organization.