Manila:Bangkok The International Monetary Fund (IMF) has projected that Sub-Saharan Africa’s economy will grow by 4.5 percent in both 2026 and 2027, despite the ongoing war in the Middle East and challenging global economic conditions. Zeine Zeidane, Director of the African Department, announced this during a news briefing on the October Regional Economic Outlook Update for Sub-Saharan Africa.
According to News Agency of Nigeria, the 2026 growth projection marks an upward revision of 0.2 percentage points from the IMF’s April forecast, showcasing the region’s economic resilience. Zeidane noted that previous reforms and businesses’ adaptability to global disruptions contributed to this optimistic outlook. However, he highlighted that the positive growth forecast conceals significant disparities among countries in the region.
Commodity exporters in Sub-Saharan Africa are benefiting from higher prices for oil, copper, and gold. In contrast, non-resource-intensive economies are experiencing slower growth and widening external deficits. Rising fuel and transport costs, along with more expensive fertilizer, could exacerbate cost-of-living pressures and threaten food security across the region. Median inflation is expected to rise from 3.4 percent in 2025 to 4.3 percent in 2026 and 5 percent in 2027.
Zeidane attributed the region’s resilience to reforms implemented before the current global shocks, including subsidy and exchange rate reforms in Ethiopia and Nigeria and structural reforms in South Africa. Adjustments in global energy supply chains and businesses’ logistics have also cushioned the impact of external disruptions.
Governments in the region have limited fiscal space to respond to further shocks, with interest payments consuming about 12 percent of government revenue, reducing resources available for essential services and investments. Although some countries maintain access to international markets, borrowing costs remain high, and reliance on domestic banks for financing can limit credit availability for businesses and households.
Zeidane reported a projected 12 percent decline in bilateral aid to Sub-Saharan Africa by 2026, following a significant decrease in 2025. This situation leaves the region vulnerable to further shocks, including energy supply disruptions, increased global risk aversion, or adverse weather events like El Nino. Ongoing conflict and insecurity also pose challenges.
To address these issues, Zeidane urged policymakers to focus on protecting vulnerable households, maintaining economic stability, and implementing long-term growth-supporting reforms. He advised against broad fuel-price relief measures, advocating instead for targeted assistance such as school feeding programs and geographically focused support.
Zeidane emphasized the need for commodity-exporting countries to save windfall revenues and suggested monetary tightening to prevent temporary price hikes from leading to persistent inflation. He called for continued reforms to improve electricity supply, expand digital connectivity, enhance skills, and create a stable business environment to attract private investment and foster job creation.
He also advocated for increased regional trade and electricity integration to broaden markets and reduce dependence on imported fuels. Closing the productivity gap between Sub-Saharan Africa and other emerging economies could unlock significant growth opportunities.
The IMF remains committed to supporting the region through financial aid, policy advice, and capacity development, tailored to each country’s circumstances. Zeidane concluded that converting resilience into lasting prosperity requires protecting vulnerable populations, preserving macroeconomic stability, and sustaining productive investment.