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West African Economies Hard-Hit by Ebola

In 2013, the World Bank ranked Sierra Leone and Liberia as second and sixth respectively among the top 10 countries with the fastest-growing GDPs. But the ongoing Ebola outbreak is threatening to change that. As the numbers of cases and deaths continue to rise, financial institutions like the World Bank say the economies of the three most affected countries, Guinea, Liberia and Sierra Leone, are being hit hard - and the impact could grow if the Ebola epidemic is not quickly contained.

The death toll from Ebola in Liberia, Guinea and Sierra Leone is approaching 4,000. If the epidemic continues, the World Bank says the impact on the countries' economies could be disastrous.

At a gathering in Washington, the presidents of those three countries pleaded with global development leaders for help. Sierra Leone’s Ernest Bai Koroma and Liberia’s Ellen Johnson Sirleaf joined the conversation via video conference.

“Ebola is now causing great destruction to agricultural, mining, manufacturing, construction, tourism, transportation and posing a significant threat to human development, state security and poverty reduction. Government revenues are drying out," said Koroma.

“Restrictions imposed on air and sea travel resulted in increased cost of travel and increase commodity prices affecting the poor," said Sirleaf.

World Bank President Jim Yong Kim says growth projections for 2014 have already been cut significantly and will be cut again next year if this disease is not contained.

“As much as $32.6 billion could be lost by the end of 2015. This is a potentially catastrophic impact," said Kim.

David Evans, a World Bank senior economist, says the countries have already been hit with serious losses.

“Across the three countries, we are seeing more than $350 million of lost output. What that means is that Sierra Leone, Liberia and Guinea will be more than $350 million poorer than they would have been in the absence of this disease," said Evans.

Take West Africa's flight industry, for example.

“What we’ve seen is that through August we’ve had more than 30 flights per week going in and out of Sierra Leone; that has dropped to six in September. We see fuel sales and other leading indicators [like] cement sales are dropping significant percentage points, so people are just afraid to invest," said Evans.

Amadou Sy, a senior fellow at the Brookings Institution, says the consequences go beyond what’s happening right now.

“On the [one] hand, all your revenues are going down because of the reduced economic activity and on the other hand you have these health expenditures, security, so you are having a fiscal deficit that’s going to be much bigger than you expected," said Sy.

Guinea's President Alpha Conde, who was at the meeting in person, confirmed that view, saying his country and others are going to need "budgetary support" to fund the fight against Ebola.

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