Africa needs USD1.2T of financing to beat COVID-19 hit: IMF

WASHINGTON (AFP) – African countries will need USD1.2 trillion through 2023 to repair the economic damage inflicted by the coronavirus pandemic, International Monetary Fund (IMF) Managing Director Kristalina Georgieva said on Friday.

About USD345 billion in financing has not yet been pledged, Georgieva said in a speech, while commitments from official lenders and international institutions cover less than a quarter of the projected need.

“All of us must do more to support Africa to cope with the next phase, which is building a recovery from this crisis,” Georgieva said.

The Washington-based crisis lender estimates Africa will see its GDP contract 2.5 per cent in 2020, one of the worst downturns the continent has ever seen. And while recovery will begin next year, pre-crisis levels of growth won’t be reached until 2022.

With private sector financing limited, the IMF projects a funding gap of USD44 billion for this year alone, and 43 million people could be pushed into extreme poverty on the continent, wiping out five years of progress in poverty reduction.

The IMF has significantly increased its financial assistance to the continent, providing about USD26 billion to more than 40 countries this year, while the World Bank has provided around USD21.9 billion in loans.