According to the IMF, six of the top-10 fastest-growing economies are expected to emerge from Sub-Saharan Africa. Ivory Coast, leading the pack, and Tanzania, ranking third, are expected to grow at 6.6% and 6.1%, respectively, thanks to their diversified economies and success in attracting foreign investments. Ethiopia, despite a recent debt default, is predicted to see 6.2% growth, placing it second.
By 2024, Sub-Saharan Africa's growth is anticipated to climb to 4%, up from 3.3% in 2023. However, the sluggish performances of South Africa and Nigeria, which combined represent two-fifths of Africa’s $2 trillion economy, could hinder the continent's overall growth. While these economic powerhouses are unlikely to deliver quicker output soon, ongoing reforms could yield future benefits. Nigeria is working to ease its foreign-exchange regime and phase out fuel subsidies, while South Africa, currently facing an energy crisis, is making initial steps towards enhancing its electricity supply.
For over two decades, China has been a key economic partner for Sub-Saharan Africa. However, the region is now grappling with a major debt build-up and a slowdown in China's growth, which may lessen demand for its commodity exports. This situation warrants a cautious economic outlook for the region in the near term.
Source: Bloomberg & the International Monetary Fund