Ebola Could Cause Loss of Billions of Dollars to Africa

O medo da doença tem reduzido a participação na força de trabalho, interrompido o transporte e levado alguns governos a fechar portos marítimos e aeroportos

A Organização das Nações Unidas para a Alimentação e Agricultura comunicou que o surto de ebola tem impactado de forma negativa a economia dos países atingidos pela doença na África Ocidental, segundo a emissora de TV americana CNN.

The fear of sickness has reduced participation in the workforce, interrupted transport and caused some governors to close their seaports and airports

The Food and Agriculture Organization of the United Nations communicated that the outbreak of Ebola has negatively impacted the economy of the affected countries through the disease of West Africa, according to the American TV program CNN.

This article was originally translated from Portuguese.  Click here to read more from RFI.

The total estimated loss for the next two years is 32 billion dollars in the event that the disease continues spreading in an unrestrained form, indicated a study divulged by the World Bank. Liberians, for example, have been required to pay 150% more for cassava, a basic ingredient in the diet of the entire country's population.

Liberia, one of the most vulnerable economies of Africa is the nation that has suffered the most with Ebola so far. More than 3,800 deaths have already been registered since the beginning of the outbreak. The number of fatalities cannot stop there.

According to a study of the Centers for Disease Control and Prevention, the cases of Ebola in Liberia and Sierra Leone could grow to between 550,000 and 1.4 million until January of 2014, if additional interventions are not made.

Sierra Leone and Guinea are other countries that face not only a grave health crisis, but also an economic one.

These three economies have been growing before the Ebola epidemic. Sierra Leone, in particular, had been identified as a country with significant growth potential. Before the outbreak, the IMF had predicted for the country a growth rate of more than 14% in 2014. The economy of Liberia had been growing close to 10% since 2005, while that of Guinea had been commended by the IMF for its economic and political reforms.

Now, the World Bank estimates that the outbreak will cost Sierra Leone 163 million dollars, or 3.3% of its GDP this year. If the epidemic continues to spread, the organization estimates that the country could lose up to 8.9% of its GDP in 2015. They estimate that the disease will cost Liberia 234 million dollars, or 12% of its GDP. In Guinea, the estimate is 142 million dollars, or 2.3% of its GDP.

Inflation also has punished the region, driven by the uncertainty and the flight of capital, while exchange rates have been volatile.

Large industries

Agriculture contributes to 57% of the GDP of Sierra Leone, 39% of Liberia and 20% of Guinea, but the fear of the disease, the introduction of a curfew, and the difficulties of transporting food should have a significant impact on food production.

West Africa is also rich in iron and gold, and the western mining businesses have a strong presence in the region. But Liberia, where more than two thousand people died as a result of the Ebola virus, closed its main border posts and introduced a temporary curfew in an attempt to contain the outbreak.

The mining sector contributed to close to 14% of the economy of Liberia, with international businesses such as ArcelorMittal, Hummingburd, Chevron and Exxon & Total operating in many of the mines of the country, however, the majority of these imposed travel restrictions on its employees and is evacuating nonessential people from the region. If this continues, "there will be a considerable decline in production," says the World Bank.

Fear

But fear is the most damaging factor to the economies of these countries, affirmed Jim Yong Kim, president of the World Bank. According to him, there was a similar situation during the outbreaks of Sars and H1N1.

"The fear factor of the Ebola outbreak reduced the participation of the labor market, closed workplaces, interrupted transport and caused some governors to close their seaports and airports," said Kim in a press conference this past week.

Close to 800 people died during the outbreak of Sars between 2002 and 2004, causing economic losses evaluated at 40 billion dollars. At the time, the deceleration was caused primarily by the flight of foreign investment.

The World Bank estimates that more than 1 billion dollars is necessary to contain the Ebola disease and avoid the economic disaster in West Africa in the long run.

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This article was translated by  Erica Kliment, Staff Intern with the Brazil Institute at the Wilson Center. 

Photo  courtesy of Stefan Koopmanschap via Flickr Commons