IMF cuts regional growth forecast to 3.8% from 4.2%
Sub-Saharan Africa’s combined economy growth is expected to expand by 3.8 per cent this year, the International Monetary Fund said in its World Economic Outlook report launch earlier. This marks a cut from its previous forecast of 4.2 per cent due to the potential impact of the U.S. administration's stance on trade. The IMF’s Africa Director, Abebe Selassie had this to say.
Fri, 25 Apr 2025 15:40:21 GMT
Disclaimer: The following content is generated automatically by a GPT AI and may not be accurate. To verify the details, please watch the video
AI Generated Summary
- Sub-Saharan Africa's growth forecast is revised down to 3.8% due to external headwinds like trade tensions and weak demand.
- The region faces challenges such as high debt levels, inflation, and declining development assistance, necessitating policy adjustments for growth and stability.
- Policy measures include building fiscal and external buffers, enhancing resilience, mobilizing revenue, improving spending efficiency, and fostering reforms for private-sector-led growth.
Sub-Saharan Africa is facing a revised growth forecast of 3.8% by the International Monetary Fund (IMF), down from the previous projection of 4.2%. The IMF's Africa Director, Abebe Selassie, highlighted the impact of external factors such as the U.S. administration's trade stance, weak external demand, softer commodity prices, and tighter financial markets on the region's economic outlook. These challenges are expected to persist, with the IMF projecting a further decrease in growth to 3.8% in 2025 and a gradual recovery to 4.2% in 2026. The decline in official development assistance to Sub-Saharan Africa adds to the strain on vulnerable populations, exacerbating existing vulnerabilities like high debt levels and inflationary pressures in some countries. In response to these challenges, the IMF emphasizes the importance of policy adjustments to promote growth, social development, and macroeconomic stability. Building fiscal and external buffers, strengthening resilience, mobilizing domestic revenue, enhancing spending efficiency, and promoting reforms to boost growth and regional integration are crucial steps to support private-sector-led growth and job creation in the region. The IMF underscores the significance of a strong, stable, and prosperous Africa not only for its people but also for global labor, investment, and consumption demand in the future. External support remains crucial as Sub-Saharan Africa undergoes demographic transitions, highlighting the strategic importance of sustained assistance for the region's development.
Get this delivered to your inbox, and more info about about our products and services. By signing up for newsletters, you are agreeing to our Terms of Use and Privacy Policy.
