The Ebola epidemic is crippling the economies of Guinea, Liberia, and Sierra Leone, according to an Economic Impact Update released by the World Bank.
The report comes as World Bank President Jim Yong Kim begins a two-day visit to West Africa to discuss with governments and international agencies what steps need to be taken to reach the goal of zero cases as soon as possible.
This report updates the World Bank’s October 8 analysis of the economic effects of the Ebola crisis on the three hardest-hit countries.
GDP growth estimates for 2014 have been revised sharply downward since pre-crisis estimates to 2.2% for Liberia (versus 5.9% pre-crisis and 2.5% in October); and 4% for Sierra Leone (versus 11.3% pre-crisis and 8% in October); and 0.5% for Guinea (versus 4.5% pre-crisis and 2.4% in October).
All three countries had been growing rapidly in recent years and into the first half of 2014.
In addition, the World Bank Group is now projecting negative growth for 2015 of -0.2% in Guinea (down from pre-crisis estimates of 4.3% and 2.0 % in October) and -2.0% in Sierra Leone (down from 8.9% and 7.7% in October).
In Liberia, where there are signs of progress in containing the epidemic and some increasing economic activity, the updated 2015 growth estimate is 3%, an increase from 1% in October but still less than half the pre-crisis estimate of 6.8%.
These latest projections imply forgone income across the three countries in 2014–15 totalling more than $2 billion.
“This report reinforces why zero Ebola cases must be our goal. While there are signs of progress, as long as the epidemic continues, the human and economic impact will only grow more devastating,” said Jim Yong Kim.
The report finds that the total fiscal impact is more than half a billion dollars in 2014 alone, imposing additional budget needs of more than 6% of GDP in Liberia, more than 3% in Guinea, and more than 2.5% in Sierra Leone.
Governments have also been forced to cut public investments, such as Liberia s Mount Coffee hydroelectric plant, which now remains on hold in the absence of foreign contractors, by more than $160 million across the three countries.
In October, the World Bank Group estimated that if the virus continued to surge in the three worst-affected countries and spread to neighbouring countries, the two-year financial impact could range from a low estimate of $3.8 billion to a high of $32.6 billion by the end of 2015.
These estimates of the scale of impact remain valid, given that the epidemic is not yet under control.
The World Bank Group is mobilising nearly $1 billion in financing for the countries hardest hit by the Ebola crisis.
Business Insider Emails & Alerts
Site highlights each day to your inbox.