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Economic Report on Africa 2021

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The COVID-19 pandemic pushed an estimated 55 million Africans into extreme poverty in 2020 and reversed more than two decades of progress in poverty reduction on the continent.
non-poor Africans are extremely vulnerable to falling into poverty unless supported by cash or food transfers. Fiscal space to mitigate poverty impacts is tight.
are more vulnerable to falling into poverty. Governments’ socioeconomic policy responses to the COVID-19 pandemic have accentuated gender inequalities.
coping strategies are at a breaking point. The pandemic’s adverse shocks have interacted with existing vulnerabilities, exacerbating the continent’s pre-pandemic socioeconomic challenges.



1. Introduction

The report provides a perspective of the causes and consequences of increased poverty due to the COVID-19 pandemic, as well as from other shocks such as an oil price collapse, within a vulnerability–poverty–resilience framework.

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2. Economic and social trends during the COVID-19 pandemic

This chapter addresses some effects of the pandemic on poverty rates, GDP growth, health spending, fiscal deficit, informal employment and gender equality. Gender inequalities have been widened by governments’ economic and social policy responses, despite gender equality being a key factor in producing higher economic growth.
3. The COVID-19 pandemic, the consequences and the response

Despite limited resources, African governments responded rapidly to the COVID-19 pandemic by adopting targeted policy interventions or stimulus packages to reinvigorate growth, boost productivity and employment, protect poor and vulnerable people and offset the socioeconomic impact of the pandemic.
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4. The nexus of poverty, risk and vulnerability

The main message of the 2021 Economic Report on Africa is that most poor people move in and out of poverty because of consumption volatility arising from both exposure to and inadequate ability to manage uninsured risks, which together lead to vulnerability, or an expectation of adverse consequences in the future. However, the insights presented in this report can assist the formulation of poverty reduction strategies in Africa.
5. Improving risk management and building resilience

This chapter develops a dashboard to monitor indicators that track progress on risk management. Given Africa’s demographics, with large shares of young and working-age people, any strategy for strengthening resilience to future shocks needs to focus on the vulnerabilities that young people face.

6. Conclusion and policy recommendations

As African countries exit their self-imposed lockdowns and chart their recoveries, they need to put in place additional measures to accelerate the economic recovery and to ensure that the people pushed into poverty by the COVID-19 pandemic can also exit that status at the soonest. In addition, they must extend strategies to protect the well-being of the poorest and most vulnerable people and focus on ensuring sustainable economic recovery and resilience against future exogenous shocks. These strategies entail a range of policy options, from immediate social assistance and income support to long-term employment creation.


This report offers the following policy recommendations for African governments
  • Access to targeted social protection
  • Improve access to labour markets
  • Promote employment for young people
  • Provide social assistance to the vulnerable
  • Ensure health protection
    • Upgrade health infrastructure
    • Build skilled health personnel
    • Provide equitable access Build a health emergency system for future pandemics to healthcare systems
  • Domestic vaccine production
  • Create decent jobs
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