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Sub-Saharan Africa to expect substantial economic growth in 2024


Last month, the International Monetary Fund, better known as the IMF, published a Regional Economic Outlook report detailing potential economic growth for Sub-Saharan Africa for the 2024 calendar year. The report, which was presented by the respective IMF Chief of Division of the African Department, Luc Eyraud, at the South African Institute of International Affairs event at the University of Witwatersrand, details a series of projections for substantial economic growth across the region, with an overall regional GDP growth projection of 4%, up from the 3.3% GDP growth witnessed in 2023. In conjunction with projections on overall GDP growth, the report also outlines a series of more specific economic projections such as those in regards to Government Deficit, Public Debt, food inflation, and specific variables contributing to GDP growth rates across the region. In short, the Sub-Saharan region of Africa is expected to experience an economic rebound after the chaos ravaging the continent from the COVID-19 Pandemic, the various military coups, and the inflationary shock due to military conflicts outside of the continent.

The report contains detailed predictions regarding a slew of economic growth indicators. Aside from the GDP growth predictions for the whole region, data regarding country-specific GDP growth projections are also presented. Within these projections, a few countries stand out. Kenya, a country which is increasingly seen as a gold standard for the continent in terms of its economic growth and global integration, continues its streak of rather remarkable economic performance, with a projected GDP growth of 5.3% in 2024, up from the 5% seen in 2023, and the 4.8% seen in 2022. Along with Kenya, Angola is also expected to see strong economic growth in 2024, with a solid 3.3% 2024 GDP growth projection, up from the 1.3% seen in 2023, proving that the resource-intensive economies of the region can perform just as well as the more modernized and integrated economies on the continent.

On the other hand, however, there are some notable projections for declines in economic growth, such as in Equatorial Guinea, which is expected to continue their enduring economic decline. In 2023, the country experienced a -6.2% GDP growth, which is projected to continue by a -5.5% in 2024. Along with Equatorial Guinea, Guinea is expected to see a slight decline in economic growth, declining to a 5.6% GDP growth prediction in 2024, down from the 5.9% experienced in 2023.

The Regional Economic Outlook report also details specific public policy priorities for African governments to combat pervasive issues which threaten sustained economic growth.

Firstly, and also the most important aspect discussed in the report, is the topic of Inflation. Inflation is well into the double digits in 14 countries, and consistently remains above target in most countries in the region. This is further exemplified by currency devaluations across the continent, such as those recently experienced by Nigeria. Along with inflation, African economies must manage exchange rate pressures, as many economies with floating exchange rates ought to allow for currencies to adjust as much as possible, since efforts to resist fundamentals-based movements come at a significant cost. Finally, the report stresses that these economies must manage their debt obligations, especially to China, while allowing for more development spending to allow economic growth within these countries. This can be accomplished by the countries in question better mobilizing domestic revenue, developing a strategic approach to spending which emphasizes development spending, borrowing prudently, and restructuring debt.

The International Monetary Fund's recent Regional Economic Outlook report for Sub-Saharan Africa predicts a substantial economic rebound in 2024, with an overall regional GDP growth projection of 4%, up from 3.3% in 2023. The report highlights specific country projections, with Kenya expected to lead with a 5.3% GDP growth, while Angola is also anticipated to experience robust growth at 3.3%. However, some countries like Equatorial Guinea are projected to face economic declines, continuing a negative trend with a -5.5% GDP growth in 2024 following a -6.2% contraction in 2023.

The report emphasizes the importance of addressing inflation, exchange rate pressures, and managing debt obligations, particularly with China, as key policy priorities for sustained economic growth in the region. Most notably, this report paints a strong case for investment and sustained growth in Sub-Saharan African economies, and shows that both resource-intensive and industrialized, modern economies can be fertile grounds for investment and economic activity.

Source: International Monetary Fund (IMF)

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