The El Niño phenomenon hits Africa’s economy… billions in losses and a threat to food security

Africa faces the possibility of another economic shock as the El Niño phenomenon approaches becoming one of its strongest on record, if trends in warming Pacific waters continue. The phenomenon may lead to severe droughts in some regions, and floods and storms in other regions, threatening agricultural production, water, infrastructure, and the stability of African economies.

The African Development Bank estimates that economic losses in the affected countries will reach between 10 and 20 billion dollars, with the possibility of a decline in GDP in the most affected countries by between 1% and 2% on average.

These estimates come after the bank expected the African economy to grow by about 4.2% in 2026, with an increase to 4.4% in 2027, before warnings emerged of the possibility of a strong wave forming that some experts describe as a “super El Niño.”

These figures represent preliminary estimates provided by the Director of the Climate Change and Green Growth Department at the African Development Bank, Anthony Nyong, who did not specify each country’s share of the expected impact. But the warning reveals that the El Niño phenomenon may go beyond a temporary weather disturbance to become an extended economic and social crisis.

El Niño phenomenon threatens economic growth

The El Niño phenomenon is associated with a periodic rise in temperature in parts of the Pacific Ocean, which leads to changing patterns of rain, heat, and winds in different regions of the world. In Africa, it may appearIts effects are in the form of prolonged drought, heavy rains and floods, or storms that hit the coasts and infrastructure.

The nature of the effect varies from one region to another. Drought conditions may persist in parts of the Sahel, while other countries face risks of floods and severe storms. Cyclone Idai, which struck Mozambique in 2019, indicates that recovery from major disasters may take years, especially when roads, water networks, homes, and farms are damaged.

Also, the losses do not stop at the cost of repairing what is destroyed by the disaster. The cessation of agricultural and industrial production, the disruption of transportation, the decline in exports, and the rise in food and energy prices are all factors that may reduce economic growth and put pressure on government resources.

These risks gain greater importance in countries that already suffer from high debt and weaknessSocial protection networks. When the El Niño phenomenon hits more than one sector at the same time, recovery becomes slower, and the gap between the needs of the population and the resources available to governments widens.

Food and water at the heart of shock

The El Niño wave between 2023 and 2024 showed the scale of the potential impact, after it caused severe drought in the south of the continent, and floods and heavy rains in East Africa. These conditions led to widespread crop losses and rising food prices, in addition to record increases in sea water levels on parts of the African coast.

The African Development Bank estimates that farmers on the continent are already facing income losses approaching $327 million during the year, while fisheries productivity may decline by between 1% and 4% as a result of rising sea temperatures and storms.

The bank’s climate official also expects the possibility of doubling the price of corn in the affected areas, which is a basic crop on which millions of families depend. This remains an expectation linked to the severity of the phenomenon and the extent of actual damage, but it shows how the El Niño phenomenon moves from fields to markets and household budgets.

The impact of the phenomenon is linked to the second goal of the Sustainable Development Goals (SDGs), concerned with eliminating hunger, specifically goal 2.4 of building sustainable food production systems that are able to withstand climate change and extreme weather events. Crop damage and declining farmers’ incomes reveal African agriculture’s need for drought-resistant seeds, better water management, and warning systems that help producers prepare before damage occurs.

The danger also extends to water security, because drought reduces the water available for drinking, agriculture, and livestock raising,While floods may pollute sources and damage drainage and supply networks.

The climate finance trap puts pressure on governments

The African Development Bank warns that countries on the continent will fall into what it describes as a “climate finance trap.” This happens when governments lack the necessary resources to respond to disasters, and are forced to withdraw funds from health, education and infrastructure budgets to cover relief and reconstruction costs.

In this case, the disaster weakens the state’s ability to finance basic services, while borrowing increases the debt burden, and when a new shock occurs, the government is less able to confront it, which repeats the cycle itself and deepens economic fragility.

Losses may extend to the banking sector if floods or storms destroy the projects and assets that it financedBanks, or if governments, companies and farmers default on associated loans. Thus, the El Niño phenomenon turns from a climate threat into a threat to financial stability.

United Nations estimates indicate that developing countries may need about $365 billion annually by 2035 to confront climate change, while international public funding for adaptation will amount to only about $26 billion in 2023.

Africa’s needs for financing adaptation during the next twelve months were estimated at about $50 billion, but the African Development Bank believes that the expected strength of El Niño may raise it to between $80 and $100 billion.

Migration and competition for resources

Loss of crops, water and income may push populations away from the worst-affected areas. In this context, select the bankSudan, South Sudan, Democratic Republic of Congo, Somalia, Mali, Burundi and Nigeria are among the countries that could face severe impacts.

These expectations do not mean that the El Niño phenomenon alone will lead to conflicts or mass migration, but it may increase existing pressures in areas suffering from poverty, conflict, and weak institutions. When water, pastures, and productive land become scarce, competition escalates between the communities that depend on them.

This is linked to the first goal of the Sustainable Development Goals (SDGs), concerned with eradicating poverty, especially Goal 1.5, which calls for strengthening the ability of the poor and vulnerable groups to withstand climate disasters and reduce their exposure to economic and social losses.

Protecting these groups requires expanding cash and food support programs, securing alternative sources of income, and providing rapid services to areas that receiveDisplaced people, so that temporary shock does not turn into long-term poverty.

Pre-disaster adaptation financing

The African Development Bank is preparing to intensify its response by reviewing the potential impact of the phenomenon on its existing and planned projects, with the possibility of restructuring some projects to help countries deal with the damage.

It also seeks to support countries in accessing additional financing from the Green Climate Fund, the Adaptation Fund, climate investment funds, and loss and damage financing mechanisms.

This move is linked to the thirteenth goal of the Sustainable Development Goals (SDGs), on climate action, specifically goal 13.1 on strengthening resilience to climate risks and disasters. Early investment in warning, preparedness, and protection of agriculture and infrastructure reduces losses.It reduces governments having to divert health and education resources after a disaster strikes.

Confronting the El Niño phenomenon requires developing early warning systems, improving seasonal expectations, supporting farmers and small-scale fishermen, protecting water and road networks, and providing concessional financing that does not add new debt burdens to the affected countries.

In this context, The Earth Guards Foundation points out that an effective response requires moving from financing relief after damage occurs to investing in prevention and building resilience. Protecting crops, water, and infrastructure before a disaster is less expensive than repairing it after it collapses.

The El Niño phenomenon puts Africa before a test regarding the ability of countries and financial institutions to act before losses expand. Every delay in financing adaptation increases the likelihood of transitionShock from climate to food, poverty, debt, and migration.