The Southern Africa Development Community released on 24th July 2021 its Regional Economic Performance, Business Environment 2020 and Medium-Term Prospects report.
The report gives an insight into the economic performance and business environment of the SADC region for year 2020. Besides presenting the economic outlook in the short to medium term, it also highlights issues on policy direction both at national and regional levels.
The report is presented in seven sections, comprising: the introduction, highlights on global economic outlook and economic developments in the region, the regional economic performance, developments with respect to major economic fundamentals in Member States, business environment, a summary of development in the area of financial inclusion, and issues for policy consideration, risk and recommendations.
According to the report, economic growth in the region contracted by 4.8% in 2020, compared to growth recorded at 2.1% in 2019. Annual inflation increased to an average of 49.6% in 2020 compared to 16.4% in 2019. The high rate of inflation is attributed largely to heightened inflationary pressures in Zimbabwe.
Both fiscal deficit and public debt increased from 3.0 % and 56.3% of GDP in 2019 to 7.3 % and 67.1 % respectively in 2020. While the region's current account balance as a ratio of GDP widened from an average deficit of 4.2% in 2019 to a deficit averaging to 4.7% in 2020.
SADC international reserves increased to 5.9 months of import cover in 2020 from 5.3 month of import cover in 2019 due to the subdued demand. On the other hand, global growth in 2020 contracted by 3.3% compared to 2.9% in 2019, as a result of a decline in commodity prices, trade policy uncertainty, escalation of trade tensions and rising debt.