The International Monetary Fund (IMF) said that the COVID-19 pandemic has triggered a cash outflow from Sub-Saharan Africa with over $4.2bn capital flight from the region since late February to date.
The IMF did not disclose the destination of those monies, however, the countries affected by the development according to the international body are; Nigeria, South Africa, Zambia, Kenya, Namibia and Rwanda.
Cote d’Ivoire and Ghana were also not left behind the report revealed.
Accordingly, the report linked the cash outflow to spill over’s from rapidly deteriorating external environment, as it has continued to be the challenges facing the region.
Many of the countries in the region have experienced a sharp slowdown in growth from their trading partners from many countries across the globe.
The global economic slowdown being threatened by the coronavirus pandemic is responsible for the lost, however, the pandemic is still expected to affect the growth in the region trading partners will shrink to about 6% in the year 2020.
The report also forecasted the tightening of global financial conditions was reducing investment flow to external pressures.
Also contained in the report was a sharp decline in the price of commodity especially the crude oil has contributed in the challenge in these part of the region resource-intensive economies, especially Nigeria and Angola being the largest exporter of crude oil.
The IMF predicted the region economy may shrink up to 1.6% in the year 2020, saying all this crisis was a result of the COVID-19 crisis.
It also projected that individual income is capable of shrinking by -3.95 on averages, warning that the crisis is threatening to reverse the recent development progress across the region and may affect some years to come.
Similarly, the World Bank and the IMF have welcomed the decision of the G20 countries to suspend debt repayment by the poorest countries.
The decision, aimed at safeguarding lives and livelihoods in nations considered as the poor across the world, as the globe battles the COVID-19 pandemic, the decision was taken at the G20 Finance Ministers’ Meeting.
A joint statement released by President of the World Bank Group, David Malpass, and IMF Managing Director, Kristalina Georgieva, hailed the outcome of the meeting, the G20 countries agreed to suspend repayment of official bilateral credit on May 1.
