Forecasters warn the El Nino weather pattern — which often drives severe droughts, flooding and storms in Africa — could turn into one of the strongest ever seen if current Pacific Ocean warming trends continue.
As well as the threat to food and water security, government finances and banking sectors could also be undermined if disasters damage infrastructure and leave cash-strapped countries struggling to repay the connected loans.
"Just this event is going to reduce heavily affected countries' GDP by 1 per cent to 2 per cent on average, which is about $US10 billion ($A14 billion) to $US20 billion ($A29 billion) across the continent," Anthony Nyong, the AfDB's director for climate change and green growth, said in an interview with Reuters.
The AfDB's most recent forecasts in May predicted Africa as a whole would see 4.2 per cent economic growth this year, rising to 4.4 per cent in 2027 assuming the US-Israeli war on Iran eases.
That, however, was before forecasts of a "super" or "Godzilla" El Nino were made.
Nyong's estimate of the likely $US10 billion-$US20 billion hit is the first given by a major multilateral development bank in relation to El Nino.
He did not provide a country-by-country breakdown of the estimate but warned it was unlikely to be a one-off either.
Drought conditions, which much of the Sahel region has been suffering from in recent years, may persist, while Mozambique's experiences after Cyclone Idai in 2019 show it can take years to recover from major storms.
Governments were also getting snared in what Nyong described as the "climate finance trap", where they lack the resources to respond to crises and are forced to raid health, education or infrastructure budgets to meet the costs.
The 2023 to 2024 El Nino event caused severe drought in Southern Africa and heavy rains and flooding in East Africa. These conditions led to widespread crop failures, surging food prices, and record-breaking sea-level spikes along the continent's coastlines.
The AfDB has estimated Africa's farmers are already facing nearly $US330 million in lost income in 2026, while fishing industries could be hit hard too due to rising sea temperatures and storms.
"When these shocks happen, countries take two steps back," Nyong said. "We don't want our countries to slide into poverty."
The AfDB's response to El Nino is set to ramp up with a bank-wide "seminar" in September as top staff assess the potential impact on both its planned and existing investments.
Nyong said it stood ready to restructure projects to help countries manage El Nino's impacts and would work with them to tap additional multilateral support such as the Green Climate Fund, the world's largest dedicated climate fund.
Other possible help could come from the Adaptation Fund, Climate Investment Funds and newer loss-and-damage financing mechanisms, he added.
