The research added that at a worst-case scenario 50 million Africans will fall below the poverty line by the end of 2020.
World Bank estimates 13 million Africans to become extremely poor
The World Bank research on the effect of the Covid-19 pandemic in Africa has indicated that an estimated 13 million Africans are expected to fall below the poverty line by the end of 2020 in the best-case scenario.
It added that the number of Africans living on less than $1.9 is likely to increase by two percent from the estimated 41.6 percent at the end of 2018 to 43.9 percent at the end of 2020. This will, therefore, lead Africa to its first recession in 25 years.
According to data, Africa’s poverty rate has in recent years dropped from 46.6% in 2010 to 41.6% in 2018. The continent saw growth at an average of six percent, one of the highest growth rates in the world.
But the World Bank research indicated that the effect of the pandemic has caused African governments, who struggled to increase revenue prior to Covid-19, to bridge expenditure deficits through debts.
The World Bank said “the swift and aggressive efforts taken by many African governments to contain the disease, necessary as they are, have come at an enormous economic cost.”
“These shocks have fallen harder on urban areas where the initial impacts of the lockdowns have been more intensely felt. Income losses have been larger for low-income and informal workers who are in jobs that cannot be done from home,” it added.
The Bank also said that 45% of urban households and 55% of rural households in Ethiopia recorded income losses due to Covid-19 while 79% of Nigerians also recorded income losses. 42% of those who were previously employed lost their jobs permanently due to the pandemic.
The story is similar in Kenya as it was estimated that over one million workers have lost their jobs or have been sent on compulsory unpaid leave.
A report from the Kenya National Bureau of Statistics, show that three in every five employees were absent from work in May.