Happy New Year! We are kicking off 2015 with an important topic around the ebola crisis. It is a new year and signs are hopeful that ebola will be contained soon, which has warranted calls for continued vigilance to make sure that the outbreak is brought under control. Apart from the social and phycological damage, what kind of financial havoc has ebola left West Africa to deal with?
Before the ebola outbreak, West Africa was posting impressive economic gains across the region. Liberia’s GDP grew by 8.1% in 2013, while Guinea and Sierra Leone expanded by 2.5% and 13% respectively in the same year. The devastation caused by the ebola outbreak this year has resulted in not only the loss of over 6,000 lives, but a cautionary economic outlook for the region.
According to the World Bank, if the current containment efforts hold, the region could experience $3 to $4 billion in negative economic impact. If left unchecked, the damage could reach as much as $30 billion. GDP growth for Liberia, Guinea, and Sierra Leone has been revised downward into 2015 by the World Bank.
On a micro level, the economic impact has hit the hardest. In Liberia for example, nearly half of the work force employed in March has yet to get back to work as of November. We mustn’t forget that among the 6,000+ lives lost to the virus, were head of households and income earners who supported many. They were also productive employers and employees who contributed to the impressive GPD growth in the region.
But it is not all bad news, however. Some companies, stalled by the outbreak, are temporarily retooling to focus on providing assistance to the ebola response. Chid Liberty’s Liberian Women’s Sewing Project (LWSP) is managing the distribution of ebola prevention kits while keeping all of its employees ebola-free. Not to mention the many local NGOs, like the Lunchbox Gift initiative that have launched or retooled their core expertise to focus on stemming the ebola outbreak.
On a macro level, the West African economies affected by ebola comprise less than 1% of the continent’s GDP. The unintended consequence of the outbreak mean the rest of Africa is and will continue to pay an ebola tax. Closed borders and quarantines have affected trade routes within the region. A false “fear factor” or “perception impact” is also negatively affecting tourism industries as far South as Kenya and South Africa, thousands of miles away. There’s even news of conferences and summits planned for 2015 being moved to Europe.
As the crisis drags on, how will the region regain its economic foothold? Not only that, given the added stigma, will it be possible to overcome the damage ebola has added to the continent’s single story? What kind of resilience will West Africans need to exhibit in order to break through the downturn? What kind of economic support will the rest of the world give to West Africa to help it resume its growth? How can we apply pressure to make sure international pledges turn into real financial disbursements that can be deployed within the affected economies?
In this week’s tweet chat, we’ll focus on the current and future economic impact of ebola on the region, as well as the rest of the continent.
When: Thursday, January 8th
Time: 12:00pm EST
Twitter Handle: @AfricaResponds
Hashtags: #AfricaResponds #UnitedAgainstEbola