UGANDA, Kampala | Real Muloodi News | The African Development Bank predicts that the East African region’s economic growth will recover to an average of 4.1 per cent in 2021. The bank predicts further growth to 4.9 per cent in 2022 and 5.6 per cent in 2023, despite having recorded only 0.4 per cent in 2020.
The Bank released their findings as part of their East Africa Economic Outlook 2021. The report reviews the economic performance of 13 East African countries, including Burundi, Comoros, Djibouti, Eritrea, Ethiopia, Kenya, Rwanda, Seychelles, Somalia, South Sudan, Sudan, Tanzania, and Uganda.
Improved performance of the agricultural sector, public spending on infrastructure and increased regional economic integration have been highlighted as key aspects that will propel the rapid recovery of the economy in the East African region.
Nonetheless, the report acknowledges that a surge in the number of infections and the slow rollout of the COVID-19 vaccines could have a tremendous negative impact on the economic recovery in the region.
According to top economists at the bank, East Africa was the only region able to prevent an economic recession because of the devastating effects of the COVID-19 pandemic.
However, the region did experience an economic recession in 2020 owing to the strict measures issued by governments to contain the spread of the deadly disease, including lockdowns, dusk to dawn curfews and a decline in the number of visiting tourists as airports were closed.
It was the high levels of economic diversification in the region and the rapid response by the governments to put in place from the start strict measures that contain the spread of the disease which allowed the area to thrive through the pandemic in 2020, says Nnenna Nwabufo, the Bank’s Director-General for East Africa.
Nnenna and her team note that although the region avoided the economic recession in 2020, they were not as lucky in preventing a spike in poverty levels caused by the pandemic. Coupled with other natural calamities such as floods and the desert locust invasion, the effects of the pandemic were adverse, mainly on the performance of the agricultural sector.
The bank is thus suggesting a mix of policy interventions such as scaling up vaccination, a design and implementation of economic stimulus packages, and dealing with public debt through domestic revenue mobilisation to speed up the region’s economic recovery and build resilience after COVID-19.
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