Economic growth in Africa is set to fall to 1.4 percent in 2016, a 23-year low, due to the drop in oil prices, drought prevalence in Southern Africa and the political crisis in East Africa, the International Monetary Fund (IMF) forecast on Tuesday.
Abebe Selassie, IMF Director of the African Department, however said the record dip in economic growth in Africa would be short-lived, and it has resulted from the massive drop in commodity prices, including heavy metals and oil, affecting key African countries.
“There are four reasons for this slowdown, the drought, low commodity prices, the tighter financing conditions and the delayed policy response in the region,” Selassie told reporters during the launch of this year’s economic outlook for the Sub-Saharan Africa.
IMF says the region is likely to recover economically within the shortest period if reforms are undertaken to correct a drop in domestic revenue and the effective management of foreign debt, which has partly affected local exchange rates.
According to the IMF projections, the economic growth in Africa is expected to grow at 3 percent in 2017 and improve to 4.5 percent in 2018.