Sub-Saharan Africa’s economy will expand faster than previously forecast next year as the global economic recovery strengthens, the International Monetary Fund said.
The region’s economy will grow 6.1 percent in 2014, more than the previous estimate of 5.7 percent and the 5.6 percent projected growth for this year, the Washington-based IMF said in its World Economic Outlook released today. The global economy will expand 4 percent next year, up from 3.3 percent in 2013, the report said.
“A main driver of growth in 2014 will be the strengthening of activity in South Africa and other middle-income countries, predicated on improvements in the external environment,” according to the report. “Similarly, some low-income and fragile countries are expected to do better, including those currently experiencing internal conflict.”
Export demand is set to improve as Europe emerges from a recession and growth in China fuels demand for commodities such as copper, iron ore and oil from sub-Saharan Africa.
Inflation will probably slow to an average of 6.3 percent in 2014 from an estimated 7.2 percent this year and 10 percent in 2011 as central banks in East Africa raised borrowing costs to curb price increases, food prices fell and output increased, the IMF said.
“The success in reducing inflation has provided room for a gradual easing of the monetary policy stance in several countries,” the IMF said.
The economies of Ivory Coast, the world’s largest producer of cocoa, and Mozambique, the site of the world’s biggest gas discovery in the past decade, will both expand 8 percent next year, the fastest pace in the region, according to the report.
Nigeria, Africa’s top oil producer, will expand 7 percent in 2014, down from an estimated 7.2 percent this year, the IMF said. Growth in South Africa, the continent’s largest economy, will probably accelerate to 3.3 percent from 2.8 percent this year as mining production rebounds, it said.