KAMPALA, UGANDA ‒ Economic growth in Sub-Saharan Africa is recovering at a modest pace, and is projected to pickup to 2.4% in 2017from 1.3% in 2016, according to the new Africa’s Pulse, a bi-annual analysis of the state of African economies conducted by the World Bank. This is below the April forecast of 2.6%.
This rebound is led by the region’s largest economies. In the second quarter of this year, Nigeria pulled out of a five-quarter recession and South Africa emerged from two consecutive quarters of negative growth.
Improving global conditions, including rising energy and metals prices and increased capital inflows, have helped support the recovery in regional growth. However, the report warns that the pace of the recovery remains sluggish and will be insufficient to lift per capita income in 2017.
Growth continues to be multispeed across the region. In non-resource intensive countries such as Ethiopia and Senegal, growth remains broadly stable supported by infrastructure investments and increased crop production. In metal exporting countries, an increase in output and investment in the mining sector amid rising metals prices has enabled a rebound in activity.
Centenary Bank donates computers to Kisubi Hospital to strengthen health service deliveryHeadline inflation slowed across the region in 2017 amid stable exchange rates and slowing food price inflation due to higher food production. Fiscal deficits have narrowed, but continue to be high, as fiscal adjustment measures remain partial.
As a result, government debt remains elevated. Across the region, additional efforts are needed to address revenue shortfalls and contain spending to improve fiscal balances.
“Most countries do not have significant wiggle room when it comes to having enough fiscal space to cope with economic volatility. It is imperative that countries adopt appropriate fiscal policies and structural measures now to strengthen economic resilience, boost productivity, increase investment, and promote economic diversification,