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Growth in sub-Saharan Africa to slow to 20-year low‚ says IMF

Growth in sub-Saharan Africa will slow to its lowest level in more than 20 years‚ due to lower commodity prices and a generally less supportive global economic environment‚ the International Monetary Fund says in its latest regional economic outlook.

The low growth in the region makes the implementation of structural reforms more urgent‚ the IMF said on Tuesday.

It sees the region’s growth slowing from 3.4% in 2015 to 1.4% in 2016. While the projection is for a modest recovery of 2.9% in 2017‚ this is “predicated on prompt action to address the large macroeconomic imbalances and policy uncertainty in some of the region’s largest economies”.

The reforms should include “measures to ensure reliable sources of fiscal revenue and efficient public spending”‚ which would go a long way towards “protecting against untenable increases in public debt”.

Countries should prioritise measures to mobilise domestic revenue in order to reduce over-reliance on revenue from commodities‚ the IMF said.

SA’s economic growth is expected to slow to 0.1% in 2016 from 1.3% in 2015‚ and then pick up to 0.8% in 2017.

Nigeria‚ another powerhouse on the continent‚ is expected to be in recession in 2016. The IMF projects a 1.7% contraction in Nigeria’s gross domestic product (GDP) in 2016‚ and growth of 0.6% in 2017.

In SA‚ IMF ascribed stalled output growth to low commodity prices and poor confidence — made worse by “structural bottlenecks and policy uncertainty”.

 

– TMG Digital/Business LIVE

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