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»Die wirtschaftliche Schwächung durch das Ebola-Virus ist enorm«

Bericht des UN-Entwicklungsprogramms UNDP zu den wirtschaftlichen Folgen des Ebola-Ausbruchs in Guinea, Liberia und Sierra Leone, 24.10.2014 (engl. Originalfassung)

Ebola Virus Disease Outbreak (EVD) is overstressing the fiscal capacity of Governments in

Guinea, Liberia and Sierra Leone

Context

The Ebola virus disease (EVD) outbreak in the Mano River Union countries of Guinea, Sierra Leone and Liberia is one of the most complex developmental challenges in recent times. In addition to truncating the appreciable economic growth of the past decade and worsening the unemployment situation in these countries, it is particularly imposing a serious stress on the fiscal capacity of governments.   The new waves of EVD are completely different in scope and in depth, partly because of cultural and institutional interplay, and partly because these countries are socially and economically integrated with their neighbours. There are more cases and associated fatalities in eight months than the combined 20 episodes of EVD outbreak since 1976. What looked like a manageable phenomenon on 25 March (86 cases and 60 deaths and localized in Guinea) has become an issue of monumental proportion (9,062 cases and 4,542 deaths – now spreading beyond borders) as of 12 October, with Guinea, Liberia and Sierra Leone as the epicentres.i   The fatality rate ranges from 36.4 per cent in Sierra Leone to around 58.0 percent in Guinea and Liberia. The improved management of the outbreak over the past months has substantially reduced the fatality rate from an average of about 70.0 percent over the past three months. Most of the dead are women and around two-thirds of those infected are in the most economically active age group (15-50 years). The disease has taken a toll on the health system, with four doctors and more than 30 nurses among the dead in Sierra Leone, and 92 health workers in Liberia. As health workers fall ill and die, and the EVD grows exponentially, these countries’ capacity to manage the disease becomes overwhelmed.and Sierra Leone? This Policy Brief looks at the impact of EVD on the fiscal space in these countries.

How has EVD crisis affected revenue generation, spending priority and public debts?

The Ebola crisis weakens the capacity to optimally generate revenues and puts pressure on public expenditures. It reduces revenue through cuts in economic activities and employment, and a reduction in tax compliance. It also increases expenditure, especially through awareness raising and sensitization, logistics and supplies, sanitation, and incentives to health workers as well as social protection responses from governments. Arising from the widening gap created between declining revenue and rising expenditures, public debt increases and the ability of these countries to grow out of aid is further weakened.

Capacity to generate tax and non-tax revenues is weakened

The decline in production and related economic activities, the resultant job losses and evacuation of expatriate workers take a substantial toll on the revenue collection of governments through a reduction in personal income tax and company income taxes. The uncertainty created by EVD has further weakened tax compliance in these countries. Government revenues from taxes, tariffs and customs from leading sectors such as tourism, agriculture, manufacturing and mining are threatened by risk aversion behaviour resulting from restrictions on movement of people and goods.

Tourism, an important source of government revenues, has been seriously hit by EVD. In Sierra Leone, the hotel occupancy rate dropped by 50.0-60.0 percent and the number of visitors to the country, which rose from around 5,500 in February to over 8,200 in April, fell considerably to less than 2,000 in August 2014. The number of weekly flights dropped from 31 until August to only six by 1 September. In Liberia, the average hotel occupancy also dropped from over 70.0 percent before the crisis to about 30 percent in September 2014, while the number of weekly commercial flights dropped from 27 between January and August to only six from the beginning of September. A similar trend is observed in Guinea: in Conakry, the hotel occupancy rate fell by half to less than 40 percent compared to an average of 80 percent before the crisis. Because taxes are paid based on rate of occupancy and number of visitors, this has led to substantial losses in revenues.

[...]

Conclusions

EVD weakens the ability of the governments of Guinea, Liberia and Sierra Leone to effectively generate tax and non-tax revenues (mostly as a result of risk aversion behaviours). Efforts to contain EVD, treat affected people and provide essential services have increased government expenditure phenomenally. The diverging trend in revenue and expenditures is exposing governments to unanticipated domestic and external debts, which should be guarded effectively to avoid fiscal unsustainability. Risk aversion behaviour, hysteria or panic, is an important channel through which EVD affects the fiscal positions of government. The best antidote for fear or panic is urgent and effective response. The international community must change the narrative that has started to stigmatized people in the Manu River Union. Sacrificing development spending, especially for roads, energy, building schools and hospitals, could truncate peace dividends in these countries. The international community should translate their pledges into commitment to halt the crowing out of infrastructure spending. Development partners’ efforts to refocus their programmatic interventions in containing is commendable and should be continued. Efforts to beef up the absorptive capacity of government is also vital. Essential services are needed in quarantine areas and treatment holding centres. It is crucial to invest in building institutional capacity of the health system in order to address the underlying causes and factors that have made it difficult to contain the outbreak. This includes renovating health infrastructure, increasing the quantity and quality of healthcare staff, and investing in the decentralization of health system management.

Den vollständigen Bericht finden Sie hier (pdf).

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