The Ebola outbreak in West Africa is not only devastating the lives of thousands of people in Liberia, Guinea and Sierra Leone, but it is devastating the economies in those countries as well.
The outbreak is expected to halve economic growth this year in Guinea and Liberia, and reduce growth by 30% in Sierra Leone, according to a 17 September report from the World Bank. It estimates total economic damages from the three countries will total US$359 million in 2014. If the world does not respond quickly with money and resources to halt Ebola’s spread, this impact could grow eight-fold next year, warns the report — the first quantitative estimate of the outbreak’s economic impact.
The United Nations’ 16 September Ebola response plan estimates that the cost of immediate response to the crisis will be close to $1 billion, double the $495 million called for by the World Health Organization on 28 August. This estimate will only continue to increase if other countries do not contribute to the response soon, World Bank Group President Jim Yong Kim said in a phone conference with reporters.
In the long term, the World Bank imagines two scenarios for Ebola’s economic impact: a ‘low Ebola’ scenario in which the outbreak is rapidly contained within the three affected countries, and a ‘high Ebola’ scenario in which it goes unchecked until well into 2015. Under the latter scenario, the economies of Guinea, Liberia and Sierra Leone would suffer significantly; Liberia could lose as much as 12% of its gross domestic product in 2015, the analysis says, thus reducing the country’s growth rate from 6.8% to –4.9%.
Agriculture and mining are the sectors worst hit, along with manufacturing and construction.
“There are two kinds of contagion,” Kim said. “One is related to the virus itself and the other is related to the spread of fear about the virus.” Health-care costs and illness from the virus itself contribute little to the economic impact, the report found. Rather, 80–90% of the economic effects are due to the “fear factor” that shuts down transportation systems, including ports and airports, and keeps people away from their jobs.
The exact number of Ebola cases, for which estimates are constantly changing, is not relevant to the economic model that the World Bank developed, Kim said. “What really matters is how quickly we scale up the response so that we can address the entire number of cases. If we get an effective response on the ground in the next few months, we can blunt the vast majority, 80–90%, of the economic impact,” he added. If this does not happen and the epidemic spreads to other countries such as Nigeria, Ghana and Senegal, Kim cautioned, the ultimate economic hit from this outbreak could reach “many billions”.
Kim also announced a new effort to develop a “universal protocol” for Ebola treatment. Paul Farmer, a physician and global-health expert at Harvard University in Cambridge, Massachusetts; Anthony Fauci, director of the US National Institute for Allergy and Infectious Disease in Bethesda, Maryland; and several non-governmental organizations such as Médecins Sans Frontières will work on the protocol for the World Health Organization to adopt to ensure that all health-care workers will be trained to treat Ebola in the same way.
Such protocols have been crucial in improving management of diseases such as tuberculosis, Kim said. For Ebola, measures that are likely to be part of the protocol include simple steps such as isolation of patients and hydration, which can greatly improve survival.