AU report shows that Africa could lose R3.6 trillion due to Covid-19

AU report shows that Africa could lose R3.6 trillion due to Covid-19

- A report by the African Union shows that the continent could lose about R3.6 trillion in revenue due to the coronavirus

- The report also showed that the continent's economic growth could shrink from 3.4% to 0.9% as a result

- The possible losses have been attributed to the outbreak of the coronavirus in the world

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The African Union (AU) has reported that Africa could lose an estimated R3.6 trillion ($270 billion) in revenue due to the Covid-19.

The AU added that the continent’s economic growth could contract to as low as 0.9% from 3.4% on average.

It explained that the loss could result in a disruption of the world’s economy through global value chains, the abrupt falls in commodity prices, fiscal revenues and the enforcement of travel and social restrictions in several African countries.

Fresh AU report shows that Africa could lose $270 billion due to COVID-19
AU's chairperson, Cyril Ramaphosa of South Africa Source:
Source: UGC

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Per a report by the Business & Financial Times, the tourism and travel industries would be hit the hardest by the outbreak, with an estimated loss of about R900 billion ($50 billion).

According to the International Air Transport Association (IATA), international bookings in the continent fell by about 20% in March and April.

It added that ticket refunds increased by 75% between 1 February and 11 March, compared to the same period in 2019.

The IATA further explained that African airlines had already lost R72 billion (US$4.4 billion) as of 11 March, with Ethiopian Airlines recording a loss of R3.4 trillion (US$190 million).

It indicated that the economic contribution of the air transport industry in Africa stands at $55.8 billion dollars, supporting 6.2 million jobs and contributing 2.6% of the Gross Domestic Product (GDP).

In other news, reported that the Economic Commission for Africa (ECA), has estimated that Africa has lost about R1 trillion in revenue since the outbreak of the coronavirus.

On Friday, 13 March, the ECA explained that the crisis could negatively affect Africa’s growth plan, which is already stagnant.

At a press conference in Addis Ababa, Ethiopia, it added that oil-exporting nations are losing revenue as crude oil prices continue to tumble.

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