US, WASHINGTON (ORDO NEWS) — About 20 million jobs in Africa are at risk as the continent’s economy is expected to contract this year due to the effects of the coronavirus pandemic. It is reported Reuters, citing an African Union (AU) study.
In a realistic scenario, AU researchers predict a contraction of Africa’s economy by 0.8%. The pessimistic scenario suggests a decline of 1.1%. In this case, up to 15% of foreign direct investment may be lost.
“Nearly 20 million jobs, in both the formal and informal sectors, are at risk of destruction on the continent if the situation continues,” the study said.
African governments can lose up to 20-30% of their budget revenues, while combating the spread of COVID-19 will increase government spending by at least $ 130 billion. Meanwhile, exports and imports are expected to decline by at least 35% compared to 2019 levels.
African oil producers, who are faced with a collapse in oil prices, will be among the most affected countries. Only the largest oil-producing countries in sub-Saharan Africa – Nigeria and Angola – can lose $ 65 billion in revenue. This year, the budget deficit of African oil exporters is expected to double, and their economy will shrink by an average of 3%.
Amid falling oil prices, African producers faced not only the loss of income that they needed to fight the coronavirus, but also the loss of their hard-won market share , which they might never return.
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