The World Health Organization has identified Ghana and eleven other countries as being particularly vulnerable to the Coronavirus outbreak, based on their direct links or high volumes of travel to China.
The eleven other countries are Angola, Ivory Coast, the Democratic Republic of Congo, Ethiopia, Kenya, Mauritius, Nigeria, South Africa, Tanzania, Uganda and Zambia.
Despite the high level of vulnerability, the WHO said most of the region is ill-equipped to address the spread of the virus domestically, given the relatively high incidence of people with compromised health (due to HIV/AIDS infections, for example) and the underdevelopment of health systems.
The WHO says around 15% of patients infected with the virus require hospital treatment, 25% needing intensive care and 5 to 10% needing mechanical ventilation, adding that most hospitals in sub-Sahara Africa would be unlikely to cope with the numbers requiring such care.
“Moreover, a pandemic in the region would undermine the already weak productivity in sub-Saharan Africa, and present a further downside risk to growth, although lower levels of urbanisation and urban population densities relative to China and other regions, as well as relatively limited intra- and inter-regional travel networks, will constrain transmission risks somewhat”, it emphasised.
International ratings agency, Fitch Research, recently pointed out that: “Our core scenario is that the Coronavirus will largely be contained within China’s borders, albeit with relatively isolated cases occurring elsewhere. All suspected infections in the region—in Botswana, Ivory Coast, Ethiopia and Kenya—have so far proved to be negative, but local detection capacity is weak (only South Africa and Senegal have dedicated testing facilities, although more are being established), and there is a clear downside risk that the disease will spread globally, including across SSA.”
Financial Market Volatility A Risk For South Africa In Particular
Mixed signals over the number of coronavirus cases—with China on February 11 reporting the lowest number of new cases since late January, and on February 12 a very sharp rise in diagnoses—underscores the risk of further financial market volatility, and shifts in global risk sentiment driven by the virus could direct short-term capital flows away from markets most heavily exposed to China.
Fitch said South Africa is the most vulnerable in this respect.
“The South African rand is the second-worst performing Emerging Market currency in the world year-to-date, losing 5.6% of its value against the dollar. While this is partly due to ongoing concerns about South Africa’s weak economic growth, challenging fiscal position and slow reform momentum, the ZAR is a proxy play for broader Emerging Marketing risk aversion, meaning that the currency will remain vulnerable to risk-off sentiment.”