Stalled by Russia’s war on Ukraine, the GDP growth of the sub-Saharan Africa is projected to slow down to 3.8% this year, from the last year’s better-than-expected 4.5%, the International Monetary Fund (IMF) said in a report on Thursday.
“The war in Ukraine has triggered a sharp increase in energy and food prices that could undermine food security in the region, raise poverty rates, worsen income inequality, and possibly lead to social unrest,” said the report titled Regional Economic Outlook.
The economy of sub-Saharan Africa will grow by 4% in 2023, data showed.
Commodity price shock is projected to have varying impact across the region as rising fuel prices may result in windfall gains for oil-exporting countries like Nigeria, it said.
Higher oil prices will add $19 billion to import bill for the region’s oil importers such as Benin, Ethiopia and Malawi, worsening trade imbalances and raising transport and other consumer costs.
Consumer inflation in the sub-Saharan Africa is forecast to come in at 12.2% this year and 9.6% next year for the highest levels since 2008.
The growth outlook of Nigeria bettered thanks to higher oil prices and a stronger-than-anticipated recovery of manufacturing and agriculture. The country’s GDP is estimated to rise by 3.4% in 2022, falling back to 2.9% from 2024 onwards, getting dampened by high uncertainty associated with oil prices and financial conditions, and low vaccination rates and rising security risks.
South Africa’s growth is expected to slow down to a modest 1.9% in 2022, held down by structural constraints and tighter global financial conditions. Source: Anadolu Agency