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Africa trade and Covid‑19: the supply chain dimension

Working papers

Written by Karishma Banga, Jodie Keane, Maximiliano Mendez-Parra, Laetitia Pettinotti

Hero image description: Shipping containers Image credit:Erwan Hesry Image license:CC BY-NC-ND

The global Covid-19 pandemic has had an enormous impact on trade across the world. Value chains and trade have slowed down, or even been brought to a halt, via several channels:

  • Reduced mobility of goods and people
  • Reduced supply channel
  • Reduced demand channel
  • Policy actions (e.g. export bans to increase domestic supply of critical products such as pharmaceuticals).

As a result, World Bank projections in June 2020 estimated a 5.2% drop in global average gross domestic product (GDP). In a worst-case scenario, the projections indicate the African economy could contract by up to 2.6% in 2020, equivalent to a loss in GDP growth of $120 billion.

This paper investigates the impacts of the pandemic on trade and value chains in Africa, with a special focus on Ethiopia and Kenya. It also makes specific policy recommendations regarding the African Continental Free Trade Area Agreement in the light of Covid-19.

Shipping containers
Karishma Banga, Jodie Keane, Maximiliano Mendez-Parra, Laetitia Pettinotti and Lily Sommer