COVID-19 is threatening to wipe out decades of economic progress and development gains. Sub-Saharan Africa fell into recession for the first time in 25 years in 2020, with economic growth contracting by 3%, the worst on record.
For many countries, a return to 2019 economic growth levels will not occur until 2022–24. Alarmingly, the pandemic will push up between 88 and 115 million people into extreme poverty — those living under US$1.90 a day — around the globe, reversing the trends of the past two decades, including up to 40 million people in Africa. Advanced economies have been able to spend trillions of dollars shoring up their economies and rolling out vaccination campaigns, which will lead to quicker economic recovery. But poorer countries have largely been left behind.
The map below shows which economies will still be significantly below pre-pandemic forecasts by 2022, and which will be able to recover more thoroughly by then.
How to ensure a global economic recovery
In order to end the pandemic and ensure an equitable global recovery, ONE is asking world leaders for an economic recovery package for vulnerable countries. This package must include:
- An increase in financial reserves in the form of a creation of US$650 billion in IMF Special Drawing Rights (SDRs) to help countries weather the crisis, with a mechanism for rich countries to donate their excess SDRs to the most vulnerable countries
- An extension of the G20’s Debt Service Suspension Initiative (DSSI) to the end of 2021 and ideally into 2022 to pause hefty debt service payments
- A comprehensive and transparent debt restructuring agreement for countries on the verge of default