World Bank projects 3.3% growth for SSA in 2021

The World Bank has revised its growth projection for Sub-Saharan Africa, projecting a 3.3% expansion in the region's economy in 2021. This revised forecast, up by one percent from previous estimates, signals optimism for a recovery in the region. Albert Zeufack, Chief Economist for Africa at the World Bank, highlighted some key drivers behind this economic rebound during an interview with CNBC Africa. The chief economist pointed to elevated commodity prices, a relaxation of stringent pandemic measures, and a recovery in global trade as key factors fueling the projected growth in sub-Saharan Africa. The rebound is particularly driven by the surge in commodity prices, with oil reaching levels higher than pre-pandemic times. Additionally, economies in the region are benefitting from the relaxation of COVID-19 restrictions and an uptick in global trade. However, while the growth outlook is positive, Zeufack cautioned that challenges remain, particularly due to the slow pace of vaccination rollout on the continent. The World Bank economist emphasized the importance of widespread access to vaccines in supporting Africa's recovery. He highlighted the crucial role of development partners, such as the World Bank, in providing financial support for vaccination programs and ensuring the availability of vaccines in the region. Zeufack also discussed the varying pace of recovery across countries in sub-Saharan Africa, noting that the three largest economies - Nigeria, South Africa, and Angola - are all emerging from recession. Despite this positive development, the speed of recovery differs among these economies, with some countries experiencing slower growth rates. Zeufack underscored the need for African countries to continue implementing structural and macroeconomic reforms to support sustainable growth. He commended the continent's efforts in fiscal discipline and inflation management but stressed the importance of striking a balance between fiscal consolidation and investments in critical areas like human capital and climate-smart infrastructure. Addressing the monetary policy response, Zeufack acknowledged the supportive stance taken by central banks, given the prevailing low global interest rates. However, he raised concerns about the impending end of the Debt Service Suspension Initiative (DSSI), which could pose challenges for countries managing their debt obligations. Looking ahead, Zeufack highlighted the importance of boosting investment flows into the continent to drive economic growth further. While the medium-term outlook remains modest, with projected growth rates hovering around 4% in 2022 and 2023, Zeufack emphasized the need for accelerated vaccination programs and increased investment to spur a more robust recovery in sub-Saharan Africa. He emphasized the potential for African countries to leverage the global shift towards decarbonization and sustainable energy sources to attract investments in green industries and manufacturing, fostering higher growth rates. Ultimately, Zeufack stressed the role of both domestic reforms and international support in ensuring a resilient and inclusive economic recovery for the region.