Sub-Saharan Africa’s growth to slow to 3.8 per cent in 2022, IMF says
On 28 April 2022, the IMF published its Sub-Saharan Africa Regional Economic Outlook for 2022, entitled “A New Shock and Little Room to Manoeuvre”
In this report, real GDP growth is projected to fall to 3.8 per cent in 2022 from 4.5 per cent in 2021, partly due to the war in Ukraine, before rising to 4 per cent in 2023.
It is well known that the war in Ukraine has had a negative effect on Africa’s food security (e.g. wheat and oil supplies), as the Russian Federation and Ukraine are among the world’s major producers and suppliers to several African countries.
“This year, however, that progress has been jeopardised by the Russian invasion of Ukraine, which has triggered a global economic shock that is hitting the region when countries’ policy space to respond to it is minimal to non-existent. Most notably, surging oil and food prices are straining the external and fiscal balances of commodity-importing countries and have increased food security concerns in the region.” IMF
In addition to addressing the local impact of war on food security and accelerating vaccination against Covid-19, the report suggests that sub-Saharan African countries manage inflation and the exchange rate.
Moreover, Sub-Saharan African countries should focus on four key policy prescriptions (IMF):
– Diversify their economies
– Promote regional integration through the African Continental Free Trade Area Agreement (AfCFTA)
– Put entrepreneurs at the centre of the economy
– Promote sustainable development by accelerating the fight against climate change
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