News / Economy

    Reports: Ebola Causing Huge Damage to W. Africa Economies

    People hand out foodstuff donated by the U.S at the West Point area that has been hard hit by the Ebola virus in Monrovia, Liberia, Aug. 26, 2014.
    People hand out foodstuff donated by the U.S at the West Point area that has been hard hit by the Ebola virus in Monrovia, Liberia, Aug. 26, 2014.
    Reuters

    Ebola is causing enormous damage to West African economies, draining budgetary resources and slashing economic growth by up to 4 percent as foreign businessmen leave and projects are canceled, 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 on Wednesday it has suspended its flights to Sierra Leone following advice from the French government. France did not recommend suspending flights to Nigeria and Guinea.

    “Revenues are down, foreign exchange levels are down, markets are not functioning, airlines are not coming in, projects are being canceled, 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 that 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 that 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, especially the main diamondiferous region Kono,” Koroma said.  Miners, he added, are too afraid to go to alluvial diamonds pits in the country's Ebola-stricken east.

    Diamond trade had also been stopped by tough border controls to curb the spread of the virus, he said.

    The AfDB this week donated $60 million towards essential supplies 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.

    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. Only one out of 13 confirmed cases is still being treated in isolation in the commercial capital Lagos.

    Congo outbreak traced to pregnant woman

    Kaberuka described the health care systems of the affected countries as “overloaded”. He said he hoped the donation would stop money being diverted away from other programs such as the education and agriculture, thereby reducing the long-term damage from the outbreak.

    “We need to begin now to plan what could happen next when Ebola is beaten,” he said.

    Echoing comments from regional governments, Kaberuka said that travel and trade restrictions imposed by airlines, shipping firms and neighboring economies was increasing the economic hardship of the affected countries.

    The World Health Organization (WHO) has repeatedly said it does not recommend travel restrictions on the affected countries due to Ebola. “I understand the countries which are posing restrictions...but let us but let us only do so based on medical evidence and not on political imperatives,” said Kaberuka.

    Democratic Republic of Congo announced on Sunday it had detected a separate outbreak of Ebola in its remote northwestern province of Equateur that had killed at least 13 people. It was Congo's seventh outbreak since the highly contagious disease - believed to be carried by bush animals - was first detected there in 1976.

    The WHO said on Wednesday that it was awaiting test results on samples of hemorrhagic fever from Congo sent to laboratories, but the outbreak appeared to be unrelated to the West African outbreak. The first case appeared to be a pregnant woman in the village of Ikanamongo who died on August 11 after butchering a bush animal, the WHO said.

    It said it had assembled a rapid response team and was ready to assist Congo if needed.    

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