Growth in sub-Saharan Africa has remained generally robust and is expected to gradually pick up in the coming years. Although near-term risks to the global economy have receded, recovery in the advanced economies is likely to be gradual and differentiated, acting as a drag on global growth, which is set to increase slowly from a trough in 2012. The factors that have supported growth in sub-Saharan Africa through the Great Recession—strong investment, favorable commodity prices, generally prudent macroeconomic management—remain in place, while supply-side developments should be generally favorable. Macroeconomic policy requirements differ across countries, but rebuilding policy buffers to handle adverse external shocks remains a priority in many countries.
Economic activity in sub-Saharan Africa has weakened markedly. To be sure, growth—at 3¾ percent this year and 4¼ percent in 2016—still remains higher than in many other emerging and developing regions of the world. Still, the strong growth momentum evident in the region in recent years has dissipated in quite a few cases.
Softening and increasingly volatile global economic conditions are expected to have only a moderate downward impact on sub-Saharan Africa this year and next. Growth is projected to remain robust at about 5 percent in 2013 and 6 percent in 2014, backed by continuing investment in infrastructure and productive capacity. This outlook is not as strong as portrayed in the May 2013 edition of this publication,1 reflecting, in part, a more adverse external environment—characterized by rising financing costs, less dynamic emerging market economies, and less favorable commodity prices—as well as diverse domestic factors. However, the magnitude of the revisions is modest (–0.7 percent of GDP on average in 2013 and −0.1 percent in 2014).