PHOTO: IMF/ESTHER RUTH MBABAZI
Fast-forward to 2081. The demographic boom currently unfolding in most sub-Saharan African countries will likely have transformed many of the region’s economies into the largest and most dynamic in the world.
Wishful thinking? Perhaps. But 30 to 40 years ago, not many would have thought that possible of China, India, Indonesia, or Turkey.
Tree factors will have an influential role in making this vision materialize:
The demographic transition that is underway: By 2050, many sub-Saharan African countries will be among the few with a rising working-age population. Much investment and consumption demand will follow factors which are certain to entice considerable innovation.
The ongoing digital revolution—which offers much scope for the diffusion of know-how, new business opportunities, and more efficient service delivery.
How effectively the region’s economies deal with the transition to a low-carbon economy and the adverse consequences that climate change is set to unleash.
This future is hard to envision now amid the unprecedented challenges of the pandemic. But it is one within reach given the region’s tremendous potential and is certainly the goal that needs to anchor policies.
The very near-term challenges are undeniable. Vaccination rates lag significantly behind those of high-income countries, averaging about 2½ percent of the population across sub-Saharan Africa by early October 2021. Most countries in the region have limited fiscal space to address investment needs, and near-term growth prospects remain below pre-pandemic projections.
Although the current focus is rightfully placed on addressing these near-term challenges, our priorities should not lose sight of countries’ long-term potential. Transformative economic and structural reforms, coupled with significant external concessional financing, will be necessary to recover from the pandemic and maximize long-term potential.