12 May 2013

Africa: IMF Proposals To Sustain Positive Sub-Saharan Economic Prospects

The Director of the African Department in the International Monetary Fund, IMF, Antoinette Sayeh has recommended a better management of natural resources to boost growth and the transformation of the agricultural sector of Sub-Saharan African countries.

This was during a joint press conference she gave at the Yaounde Hilton Hotel on May 11, 2013 with Cameroon's Minister of Finance, Alamine Ousmane Mey. The press conference concluded a session organised to present the May 2013 Regional Economic Outlook, Building Momentum in a Multi-speed World with focus on Sub-Saharan Africa.

The IMF senior official said the near-term outlook for Sub-Saharan Africa remains broadly positive with growth projected to accelerate modestly despite a difficult global world economic situation. She said that in 2012 economic growth rate in Sub-Saharan Africa was 5.1 per cent, growth rate in 2013 projected at 5.4 per cent and 5.7 per cent in 2014. The growth is conditioned on the implementation of sound macroeconomic policies. Following the report, growth in the region is further supported by rebound from floods in countries such as Nigeria, recovery of agriculture in regions previously affected by drought, gradual normalisation of activity in post-conflict countries. Inflation is also expected to further decline to below six per cent by the end of 2014, reflecting the expectation of moderating non-oil commodity prices and maintenance of appropriate monetary policy. Growth was noticeably strong among oil exporters and low-income countries. However, middle-income countries with closer ties to Europe had a deceleration.

According to the Director of IMF's African Department, the main downside risks to growth in Sub-Saharan Africa remains uncertainties in the global economy, though she considers the possible adverse shocks not to have a likely large effect on the region's overall performance. The report recommends investment in export-oriented sectors. Countries equally have to maintain prudent fiscal policies, consider various means of financing, follow best practices to ensure the most favourable financing conditions. Sub-Saharan countries equally have to reform energy subsidies, replacing the costly ones with better-targetted forms of social protection.

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