Sub-Saharan African growth slumps to 15-year low
From MARIA MACHARIA in Nairobi, Kenya
NAIROBI, (CAJ News) – Sub-Saharan Africa is set to experience a second difficult year as the region is hit by multiple shocks emanating from the commodity price slump.
In its April 2016 Regional Economic Outlook for the region, the International Monetary Fund (IMF) projects growth in the region as a whole to fall to 3 percent in 2016, the lowest level in some 15 years.
The slowdown reflects the adverse impact of the commodity price slump in some of the larger economies and more recently the drought in eastern and southern Africa.
The sharp decline in commodity prices, a shock of unprecedented magnitude, has put many of the largest sub-Saharan African economies under severe strain.
As a result, oil exporters, such as Nigeria and Angola but also most countries of the Central African Economic and Monetary Union, continue to face particularly difficult economic conditions.
Non-energy commodity exporters such as Ghana, South Africa and Zambia, have also been hurt by the decline in commodity prices.
Several southern and eastern African countries including Ethiopia, Malawi and Zimbabwe are suffering from a severe drought that is putting millions of people at risk of food insecurity.
Antoinette Sayeh, Director of the IMF’s African Department, said Africa needed a substantial policy reset to reap the region’s strong potential.
“This is particularly urgent in commodity exporters and some market access countries, as the policy response to date has generally been insufficient,” she said.
Ironically, many countries in the region continue to register robust growth.
In particular, most oil importers are generally faring better with growth in excess of 5 percent in countries such as Ivory Coast, Kenya, and Senegal, as well as in many low-income countries.
In most of these countries, ongoing infrastructure investment efforts and strong private consumption support the growth.
– CAJ News
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