IMF Downgrades Africa Economic Growth

ADDIS ABEBA – The International Monetary Fund (IMF) has cut its growth forecasts for Sub Saharan economy for this year and next.

The fund’s World Economic Outlook, which was released on Tuesday, projects a growth of 3.4 percent in 2019 and 3.6 percent in 2020 for Africa.

In both cases, the projections are cut by 0.1 percentages.

It says the projections are “0.1 percentage point lower for both years than in the April’s WEO report, as strong growth in many non-resource-intensive countries partially offsets the lackluster performance of the region’s largest economies.

The Fund, however, says higher, albeit volatile, oil prices have supported the outlook for Africa’s major economies Angola and Nigeria as well as other oil-exporting countries.

But growth in South Africa is expected at a more subdued pace in 2019 than projected in the April following a very weak first quarter, reflecting a larger-than-anticipated impact of strike activity and energy supply issues in mining and weak agricultural production.

Globally, the IMF expects GDP to grow 3.2% this year, or about 0.1% below its previous estimate. Growth “remains subdued”, the IMF says, and there is an urgent need to reduce trade and technology tensions.