The Ebola outbreak in west Africa is likely to result in a $32.6bn hit to the region’s economy over the next 15 months if it is not contained in the three countries now affected most, the World Bank warned on Wednesday.
The estimate made by economists for the bank ahead of its annual meeting this week provides the starkest picture yet of the growing economic cost of an outbreak that has already left more than 3,400 people dead in west Africa and this week saw a nurse in Madrid catch the virus, the first case to originate outside Africa.
The bank’s economists said in the new report their forecast would justify the world spending billions to contain the outbreak which has spread largely unchecked in Guinea, Liberia and Sierra Leone due to the poor health infrastructure in those countries.
Under a “Low Ebola” scenario which would see the outbreak contained to those three countries by the end of this year the impact on gross domestic product would amount to $3.8bn by the end of 2015, the economists said.
But under a “High Ebola” scenario under which the outbreak spreads to neighbouring countries in west Africa such as Ghana, Nigeria and Senegal, the hit to the region’s economy would be $7.4bn this year and a further $25.2bn in 2015, or the equivalent of 3.3 per cent of regional GDP.
“This is an enormous cost, not only for the most affected countries, but for the region as a whole. It has the potential to be deeply destabilising and requires an immediate response,” the 71-page report said.
The death toll from the worst Ebola outbreak in west Africa is mounting, and for the first time the disease has spread to major urban centres
The US Centers for Disease Control and Prevention warned last month that, if uncontained, the outbreak could lead to as many as 1.4m cases of Ebola and about 700,000 deaths by the end of January next year in the three most-affected countries. That, the World Bank economists said, would be equivalent to the number of people who die in those countries in three or more years and amount to a “catastrophic mortality event that has not been seen on earth since the 1918 influenza epidemic”.
Under their “High Ebola” scenario the World Bank economists modelled the impact of a less catastrophic outbreak that would see about 200,000 cases spread across west Africa and 100,000 deaths before the outbreak was extinguished by the end of 2015.
Virologists rejected suggestions on Tuesday that Ebola might mutate to become an airborne virus after a Spanish nurse became the person to contract the virus outside of west Africa. Continue reading
The main impact on the economy would be through lower growth with the rate across the region expected to tumble from the 6.7 per cent growth forecast for this year to 4.1 per cent in 2015.
“With swift international action Ebola can be contained and not only thousands of precious lives could be saved but also economic cost for the region could be limited,” the World Bank economists wrote. “If the outbreak is not contained the economic costs could run into billions of [dollars] in foregone output.”
“Acting fast not only saves precious lives, but our estimates indicate that spending even billions of dollars to contain the spread would be cost effective,” they said.