According to the East Africa Regional Economic Outlook 2020 by the African Development Bank (AfDB), East Africa continues to be fastest growing region on the continent despite the disruption by the Covid-19 pandemic.
Prior to the pandemic, the region’s economic growth was projected to be over 5%, which is higher than Africa’s average, which stands at 3.3% and the global average which is 2.9%. However, with COVID-19 having caused havoc as well as the locust invasion experienced in the region, job layoffs and business closures have been experienced throughout the region.
As a result of these economic disruptions the outlook projects that its growth will go down to 1.2% assuming the virus is contained by the third quarter of this year. If the pandemic persists to the end of 2020, then the projection will reduce further to 0.2%. Nonetheless, this will still be higher when compared to Africa’s predicted average of -1.7% in the same conditions.
According to Simon Kiprono Chelugui, Cabinet Secretary Ministry of Labor, East African countries could overcome the effects of COVID-19 and turn their economies around by mitigating the external and domestic risks.
“We need to implement a decisive and coordinated response to contain the spread of Covid-19; mitigate its health and socio-economic effects; accelerate structural transformation; improve the investment climate, and maintain the peace and security of our region,” he said.
Before the pandemic is dealt with, the region will face many challenges such as falling commodity prices and trade, and restrictions on travel with a consequent negative impact on tourism. This has already started to take form as many countries such as Kenya are already facing a reduction in tourism. To help the region, Nnenna Nwabufo, the director general of the Bank’s East Africa Regional Office, pledged bank support to steer the region out of the crisis.
“Our ambition is to address the adverse effects of COVID-19 pandemic and ensure that social and economic development across the continent is accelerated, including through the creation of an African workforce of the future,” she said.