Despite positive outlook Sub-Saharan African countries continue to face financing shortages, high borrowing costs – IMF Report
Sub-Saharan Africa continues to face some challenges despite the outlook gradually improving after four turbulent years, the International Monetary Fund (IMF) Regional Outlook has said.
The report said growth will rise from 3.4 percent in 2023 to 3.8 percent in 2024, with nearly two thirds of countries anticipating higher growth.
In general, economic recovery is expected to continue beyond this year, with growth projections reaching 4.0 percent in 2025.
“Additionally, inflation has almost halved, public debt ratios have broadly stabilized, and several countries have issued Eurobonds this year, ending a two-year hiatus from international markets.
“However, not all is favorable. The funding squeeze persists as the region’s governments continue to grapple with financing shortages, high borrowing costs, and impending debt repayments. Risks to the outlook remain tilted to the downside,” it said.
Debt levels in sub-Saharan Africa have largely stabilized at around 60% of GDP. Global capital markets are reopening for some countries. Find out more. https://t.co/nk9IfAWP2S pic.twitter.com/5dMIfcMigB
— IMF (@IMFNews) May 10, 2024
The sub sahaha region continues to be more vulnerable to global external shocks, as well as the threat of rising political instability, and frequent climate events, the report noted.
“Three policy priorities can help countries adapt to these challenges: improving public finances without undermining development; monetary policy focused on ensuring price stability; and implementing structural reforms to diversify funding sources and economies.
“Amid these challenges, sub-Saharan African countries will need additional support from the international community to develop a more inclusive, sustainable, and prosperous future.”
