IMF Predicts Sub-Saharan Africa Economy To Grow at 3.2% in 2019

IMF Predicts Sub-Saharan Africa Economy To Grow at 3.2% in 2019

In sub-Saharan Africa, economic growth is expected to be at 3.2 percent in 2019 and 3.6 percent in 2020 largely due to subdued growth in the three largest economies. The slow growth is also attributed to the trade tensions between US and China.

Nigeria endured volatile oil prices in the first two quarters of 2019 leading to subdued growth. On the other hand, Angola’s economy is expected to contract this year owing to a decline in oil production. 

Similarly, in South Africa growth is expected to be weaker reflecting the impact of labour strikes and energy supply issues in mining, together with weak agricultural production.

IMF estimates that in 2020 growth in Nigeria will be at 2.5 percent, Angola 1.2 percent, and South Africa 1.1 percent.  

Nonetheless, IMF expects about 20 African economies to experience solid growth faster than 5 percent this year accounting for 34 percent of Sub Saharan Africa GDP.

For instance, Ivory Coast, Ethiopia, and Senegal are projected to be Africa’s fastest-growing economies next year with 7.3, 7.2, and 6.8 percent growth rates respectively.

In the October World Economic Outlook, the IMF expects Kenya’s real GDP to grow by 5.6 percent in 2019 and 6.0 percent in 2020.

There has been weak business confidence amid growing tensions between the United States and China on Trade and technology.

Manufacturing firms are cautious about long-range spending thus have held back on equipment and machinery purchases.  

Countries should seek macroeconomic policies such as monetary policy to stabilize activity and strengthen the foundations for recovery or continued growth.

In the medium term, Sub Saharan growth is projected to
increase from 3.6 percent in 2020 to 4.2 percent in 2024.

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