Southern Africa’s economic output to contract by as much as 6.6%; Zimbabwe, Zambia and Mozambique most at risk of debt distress – AfDB

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Southern Africa’s economic output to contract by as much as 6.6%; Zimbabwe, Zambia and Mozambique most at risk of debt distress – AfDB

9:48 CAT | 29 Jul 2020

The African Development Bank Group headquarters in Le Plateau, the business district of the Ivorian capital Abidjan. [File photo: AFP]

The African Development Bank said that reduced travel and limitations on cross-border operatives enforced during the COVID-19 epidemic were therefore bound to have a telling effect on the southern Africa region, which accounts for over 45% of Africa’s travel and tourism industry.

The African Development Bank said that southern Africa’s economic output would shrink by as much as 6.6% this year due to the impact of the coronavirus pandemic.

The bank said that its best-case scenario saw output growth being constricted by 4.9% with a 6.6% contraction forecast under its worst-case scenario.

The African Development Bank said that the southern Africa region, which includes South Africa, oil-exporter Angola, as well as Botswana, Namibia, Zimbabwe, Zambia, and Malawi, was set to grow by 2.1% this year.

But this was before the coronavirus struck.

When the pandemic was first detected in the region in March, most countries enforced lockdowns.

The bank said that reduced travel and limitations on cross-border operatives were therefore bound to have a telling effect on the southern Africa region, which accounts for over 45% of Africa’s travel and tourism industry.

The African Development Bank has cited Zimbabwe, along with Zambia and Mozambique, as the countries most at risk of high debt distress.

The South African Reserve Bank has estimated that South Africa will see a growth contraction of around 7.3% and there are concerns about the country’s debt.

Source: EWN