October 31, 2014
African Development Bank: Ebola causing huge economic damage
Ebola is causing enormous damage to West African economies, draining scarce public funds and slashing economic growth by up to 4 percent as foreign businessmen leave and projects are cancelled, the African Development Bank president said.
As transport companies suspend services, cutting off the region, governments and economists have warned that the worst outbreak of the hemorrhagic Ebola fever on record could crush the fragile economic gains made in Sierra Leone and Liberia following a decade of civil war in the 1990s.
Air France, the French network of Air France-KLM said today it had suspended flights to Sierra Leone after advice from the French government. France did not recommend suspending flights to Nigeria or Guinea.
"Revenues are down, foreign exchange levels are down, markets are not functioning, airlines are not coming in, projects are being cancelled, business people have left - that is very, very damaging," African Development Bank (AfDB) chief Donald Kaberuka said in an interview late on Tuesday.
"The numbers I have had vary from one percent to four percent of GDP. That is a lot in a country with a GDP of US$6 billion," Kaberuka said, when asked to quantify the impact.
Liberia has already said it would have to lower its 2014 growth forecast, without giving a new one.
Sierra Leone Deputy Minister of Mineral Resources Abdul Ignosis Koroma also told Reuters the government would miss its target of exporting $200 million in diamonds this year because of the Ebola outbreak, versus $186 million last year.
"There is no way the government can reach this amount since the districts where diamonds are mined are not Ebola-free," Koroma said.
He said miners were too afraid to go to alluvial diamonds pits in the Ebola-stricken east and tough border controls to curb the spread of the virus were also hurting the trade.
Iron ore miner London Mining, whose only operating mine is in Sierra Leone, said recently that Ebola could hurt its production this year. Several international companies in the region have pulled out expatriate staff in recent weeks.
The AfDB this week donated $60 million to help train medical workers and purchase supplies to fight the outbreak, which has already killed more than 1,400 people, mostly in Guinea, Sierra Leone and Liberia.
Some $15 million will be disbursed in September, Kaberuka said during a press conference in Liberia on Wednesday.
The disease also has a toehold in Africa's most populous country Nigeria, where it has killed five people, but authorities there say the outbreak has been contained so far.
"Nigeria is still at risk of Ebola because we still have one case and from this one case the risk of spread is still there," Nigerian Health Minister Onyebuchi Chukwu said.