IMF projects bright economic future for African countries

By Taiwo Osho
The International Monetary Fund, otherwise known as World Bank has projected signs of economic improvement for sub-Saharan Africa by 2025, after four years marked by economic turbulence.
This was disclosed at the just concluded Spring Meeting and Annual General Meeting of the World Bank held in Washington DC between 15th and 19th of April, 2024.
According to the data released at the global event, the region is poised for growth, with projections indicating an increase from 3.4 percent in 2023 to 3.8 percent in 2024. It also stated that nearly two-thirds of countries in the region are anticipating higher growth rates. The positive trajectory is expected to continue beyond 2024, with growth projections reaching 4.0 percent in 2025.
It was stated that a significant factor contributing to the improved outlook is the notable decrease in inflation, which has almost halved compared to previous years. Additionally, public debt ratios have generally stabilized, and several countries have successfully issued Eurobonds this year, marking the end of a two-year hiatus from international markets.
Despite these encouraging developments, the report noted that challenges still persist, casting a shadow over the region’s economic recovery.
“Governments in sub-Saharan Africa continue to grapple with funding shortages, high borrowing costs, and impending debt repayments, contributing to a persistent funding squeeze. Moreover, the region remains vulnerable to global external shocks, as well as threats such as rising political instability and frequent climate events,” it revealed.
To navigate these challenges and build a more resilient future, it stressed that policymakers are urged to prioritize three key policy areas. These include:
Improving Public Finances which is crucial for governments without compromising long-term development goals.
Monetary Policy for Stability which emphasis should be placed on monetary policies aimed at ensuring price stability, and essential for fostering sustainable economic growth.
Structural Reforms for Diversification which is necessary to diversify funding sources and economies, reducing reliance on volatile external factors.
“Despite the daunting obstacles, sub-Saharan African countries are committed to pursuing inclusive, sustainable, and prosperous futures. However, achieving these aspirations will require additional support from the international community.
“As sub-Saharan Africa continues its journey towards economic recovery and resilience, collaboration and concerted efforts from governments, businesses, and stakeholders worldwide will be essential to overcome the challenges and build a brighter future for all,” it noted.


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