The International Monetary Fund (IMF) has called on Nigeria, South Africa and Angola to ensure solid economic footing to accelerate African economic growth.
The IMF Chief Economist, Mr Maurice Obstfeld, made this call on Tuesday in Bali, Indonesia at the unveiling of the October 2018 World Economic Outlook, a publication of the IMF.
He observed that their proper footing would check impediment of the growth of the African economy.
According to IMF, Nigeria, South Africa and Angola, the three largest economies in the continent are impeding the growth of African economy.
He said that the aggregate growth rate for the continent was held down by the fact that the three largest economies were not performing up to their potentials.
According to IMF, Nigeria, South Africa and Angola, the three largest economies in the continent are impeding the growth of African economy.
“Nigeria’s growth is at 1.9 per cent this year to 2.3 per cent next year and South Africa with 0.8 per cent this year, Angola contracting by 0.1 per cent this year.
“So the aggregate is over three per cent this year and close to four per cent next year and this is in spite of the fact that the largest economies in the continent are doing poorly.”
Obtsfeld, however, said the continent could do much better once the countries got solid economic footing, particularly South Africa and Nigeria.
“This is because they are really large countries and their economic activities will always have effect on their neighboring countries,’’ he said.
According to the report, Africa’s growth performance varies according to countries, while about half of the expected pickup in growth between 2017 and 2018 reflects the growth rebound in Nigeria.
“Nigeria’s growth is projected to increase from 0.8 per cent in 2017 to 1.9 per cent in 2018 and 2.3 per cent in 2019 (0.4 percentage point higher than in the April 2018 WEO for 2019).
“This is buoyed by the impact of recovering oil production and prices,” the report indicated.
It also said that inflation pressures in sub-Saharan Africa had broadly softened, with annual inflation projected to drop to 8.6 per cent in 2018 and 8.5 per cent in 2019, from 11 per cent in 2017.
“For Nigeria, inflation is projected to fall to 12.4 per cent in 2018, from 16.5 per cent in 2017 and to rise to 13.5 per cent in 2019.
The report said that global growth was projected at 3.7 per cent for 2018-19, which is 0.2 percentage point lower for both years than was forecast in April.
“In United States, momentum is still strong as fiscal stimulus continues to increase.
“However, the forecast for 2019 has been revised down due to recently announced trade measures, including the tariffs imposed on 200 billion dollars of US imports from China.”
The IMF, however, advised countries to foster cooperation and work together to tackle challenges that extend beyond their borders.
It said cooperative efforts were also essential to complete the financial regulatory reform agenda, strengthen international taxation, enhance cyber security and tackle corruption.
It said that to strengthen the potential for higher and more inclusive growth, all countries should grasp the opportunity to adopt structural reforms and policies that raised productivity and ensure broad based gains.
The IMF also advised that low-income developing countries should improve on their convergence prospects.
It explained that continued progress towards the 2030 United Nations Sustainable Development Goals (SDGs) was imperative to foster greater economic security and better living standards for a rising share of the world’s population.
“Given their generally high levels of public indebtedness, low-income developing countries need to make decisive progress to strengthen their fiscal positions while prioritising well-targeted measures to reduce poverty.
“They must also boost the resilience of their financial systems,” it said.
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