sub-Saharan African economies will grow at the slowest pace in 16 years and lower than the global average this year, reversing a trend that saw the region elevated to one of the fastest-expanding global frontiers in previous years, the International Monetary Fund said Tuesday.
The region will grow on average by 3% in 2016, below the 3.2% global average, extending diminished growth of 3.4% in 2015, as several of the continent's major economies struggle because of record low oil and mineral prices.
It said policies in oil exporters, among them the biggest economy on the continent, Nigeria, have so far been disappointing and have compounded the troubles caused by diminished trade and government revenue as a result of cheap oil.
"For natural resource exporters, a robust and prompt policy response is needed given the prospect of an extended period of sharply lower commodity prices," the Washington, D.C.-based institution said.
"To date, the policy response--particularly among oil exporters--to a terms-of-trade decline of historic magnitude has to a large extent been hesitant and insufficient," it added.
China's diminished demand for Africa' minerals has dramatically altered the trade balance between the two, with a major surplus for Africa swinging to a deficit. African exports to China, the region's biggest trade partner and source of investment, have declined sharply, whereas Chinese exports to Africa have lowered more moderately, exacerbating the reversal of the trade balance.
"These trends are likely to remain a drag on growth over the medium term, " the IMF predicted, although it said that overall Africa' medium-term growth prospects were "robust."
