- IMF projects Sub-Saharan Africa’s economy to grow by 3.6% in 2023 and 4.2% in 2024.
- Senegal, Cote d’Ivoire, and Kenya are forecast to lead the pack of major performers with growth rates of 8.3%, 6.2%, and 5.3% respectively, in 2023.
- Six low-income African countries, including Ethiopia and Tanzania, are projected to post stronger growth rates above 5% in 2023 and 2024.
The International Monetary Fund (IMF) has projected that the economy of Sub-Saharan Africa (SSA) will grow by 3.6 per cent in 2023 and accelerate to 4.2 per cent in 2024. According to the World Economic Outlook report released on Tuesday, the growth in the region will be slower in 2023 due to the impact of the COVID-19 pandemic and the Ukraine crisis, but will recover the following year.
The IMF report reveals that emerging markets and developing economies are expected to have stronger economic prospects than advanced economies, but this varies widely across regions. Five oil-exporting countries in the SSA, namely Nigeria, Angola, Gabon, Chad, and Equatorial Guinea, are projected to register a combined growth rate of 3.2 per cent in 2023 and 3.0 per cent in 2024.
However, Equatorial Guinea is the only country among the five whose economy is expected to contract by 1.8 per cent in 2023 and 8.2 per cent in 2024. In contrast, Senegal is projected to register the highest growth in the SSA, with 8.3 per cent in 2023 and a double-digit growth of 10.6 per cent in 2024. Nigeria, Africa’s largest economy, is expected to post growth rates of 3.2 per cent and 3.0 per cent in 2023 and 2024, respectively.
South Africa, one of Africa’s most industrialized economies, is expected to grow by 0.1 per cent in 2023 and 1.8 per cent in 2024. Among low-income African countries, Ethiopia, Tanzania, the Democratic Republic of Congo, Uganda, Burkina Faso, and Mali are projected to post stronger growth rates above 5 per cent in 2023 and 2024. Meanwhile, among middle-income countries, Senegal, Cote d’Ivoire, and Kenya are forecast to lead the pack of major performers with growth rates of 8.3 per cent, 6.2 per cent, and 5.3 per cent respectively, in 2023.
The IMF report cautions that while GDP is expected to grow by 5.1 per cent on average in low-income developing countries over 2023-2024, projected per capita income growth averages only 2.8 per cent during the same period, which is below the average for middle-income economies (3.2 per cent). This falls below the path needed for standards of living to converge with those in middle-income economies, the report says.
The IMF also warns that many economies are still absorbing the shocks of the Ukraine crisis and the outbreak of COVID-19, while the recent tightening in global financial conditions is hampering recovery. As a result, many economies will likely experience slower income growth in 2023 amid rising joblessness. The IMF report states that “over the medium term, the prospects for growth now seem dimmer than in decades.”