IMF bearish on Africa growth this year

Several southern and eastern African countries were suffering from severe drought

Economic growth in sub-Saharan Africa will likely slow this year to its weakest in nearly two decades, hurt by a slump in commodity prices, the Ebola virus outbreak and drought, the International Monetary Fund (IMF) said yesterday.

In its African Economic Outlook, the fund said the region would likely grow 3% this year – the lowest rate since 1999 – after expanding by 3.4% in 2015.

Growth was seen recovering to 4% next year, helped by a slight recovery in commodity prices, and the fund said it was still optimistic about the region’s prospects in the longer term.

Countries hurt by the drop in commodities prices needed to control their fiscal deficits, because the declines in revenue were expected to persist, the IMF said.

Angola and Nigeria, both major oil exporters, were hardest hit by the commodities slump, the report said. So were Ghana, South Africa and Zambia.

Several southern and eastern African countries, among them Ethiopia, Malawi and Zimbabwe, were suffering from severe drought, the IMF said. And Guinea, Liberia, and Sierra Leone were only gradually recovering from the Ebola epidemic. However, the report said, Ivory Coast, Kenya and Senegal would see growth of more than 5%, mostly “supported by ongoing infrastructure investment efforts and strong private consumption”.

“The decline in oil prices has also helped these countries, though the windfall has tended to be smaller than expected, as exposure to the decline in other commodity prices and currency depreciations have partly offset the gains in many of them,” it said. –