World Bank Cuts Growth Figures for Sub-Saharan Africa

The World Bank has revised its 2017 growth figures for sub-Saharan Africa, following weak policy responses to the recent economic crisis in the region’s largest economies.

Cutting its growth figures for sub-Saharan Africa from 2.9 percent to 2.6 percent, according to Bloomberg, the bank publicized its figures through its biannual “Africa Pulse” report, which was released Wednesday.

According to the report:

The region’s three largest economies – Angola, Nigeria, and South Africa – are projected to post only a modest rebound in growth following a sharp slowdown in 2016.

Investment growth will recover only gradually amid tight foreign-exchange liquidity conditions in major oil exporters and low investor confidence in South Africa.

While it cut South Africa’s forecast for this year to 0.6 percent from 1.1 percent, citing weak investor confidence in the South African economy due to the recent sack of the country’s finance minister, the World Bank forecast Nigeria’s GDP growth up from 1 percent to 1.2 percent.

The bank’s growth forecast for Angola, Africa’s biggest oil producer, however, remained unchanged at 1.2 percent.

World Bank Africa Chief Economist Albert Zeufack told press in a video conference from Washington that 2017 growth figures are ultimately expected to be slightly better than the 1.3 percent recorded in 2016, which was the lowest in two decades.

“As countries move toward fiscal adjustment, we need to protect the right conditions for investment so that Sub-Saharan African countries achieve a more robust recovery.”

Zeufack cautioned, however, that it was still too early to celebrate, “We are pleased that Africa is back to growth but we are not out of the woods yet. That’s why we need to strengthen reforms to make sure stability is maintained. Africa is still growing at negative per-capita rates.”

The report expects growth figures in countries, such as the Ivory Coast, Ethiopia, Kenya, Mali, Rwanda, Senegal, and Tanzania, which are not dependent on the extractive industry and continue to show economic resilience.

“GDP growth in countries whose economies depend less on extractive commodities should remain robust, underpinned by infrastructure investments, resilient services sectors, and the recovery of agricultural production,” the report added.