It is certain that Sub-Saharan Africa will experience a recession of about -3.3 per cent in 2020, its first in 25 years, according to the World Bank’s latest regional economic analysis, Africa’s Pulse. This, the report fears could drive up to 40 million people into extreme poverty in Africa in 2020, erasing at least five years of progress in fighting poverty. Lower domestic consumption and investment, due to the pandemic and related containment measures, pushed the regional economy into recession while on the supply side, large contractions in the service and industrial sectors supported the downturn. “Baseline projections assume that new COVID-19 cases will continue to slow across the region, new outbreaks will not lead to national lockdowns, government policy responses will boost business and consumer confidence, the global economy will continue to rebound, and commodity prices will remain stable,” The World Bank noted. The decline in growth has been stronger among metals exporters where real GDP is expected to contract by six percent, while oil exporters are projected to fall by more than four per cent in 2020. For non-resource-intensive countries where Rwanda falls, the decline in growth in 2020 is expected to be moderate, and in some non-resource-intensive countries, growth is expected to slow substantially, but remain positive. The World Bank noted that the downturn in economic activity will cost the Sub-Saharan Africa region at least $115 Billion in output losses this year while Gross domestic product per capita growth is expected to contract by nearly 6.0 per cent, caused by lower domestic consumption and investment. The bank noted that the road to recovery will also require massive investments across countries, as well as financial support from the international community, recommending a bold reform agenda that includes policies that create fiscal space, along with policies to speed up job creation. “Steady recovery in Sub-Saharan Africa after the COVID-19 pandemic requires policies that foster sustained growth and build resilience, but growth alone is not enough. African countries need to prioritize now policies and investments to create more better and inclusive jobs: that’s the key to sustained, inclusive and resilient growth,” said Albert Zeufack, World Bank Chief Economist for Africa region. Recovery is expected from next year with the Sub-Saharan Africa’s real projected to pick up to 2.1 per cent in 2021. For Rwanda, the World Bank noted that there is likely to be export expansions as the country opens up which could see a growth in export revenues. Rwanda was also featured among the top growth performers in the region, which includes the improved and established countries. The only five countries that were listed were Côte d’Ivoire, Ethiopia, Ghana, Guinea, and Rwanda. The growth performance was based on speed and persistence of the rate of growth of GDP which also paints a picture of growth resilience.
