By Dr Debesh Bhowmik
The Sub-Saharan Africa composed of 7 economic regional blocs, namely, The West African Economic and Monetary Union (WAEMU), Economic and Monetary Community of Central African States (CEMAC), Common Market for Eastern and Southern Africa (COMESA), East African Community (EAC-5), Southern African Development Community (SADC), Southern African Customs Union (SACU), and Economic Community of West African States (ECOWAS) respectively. On economic background, SSA can be classified as,Oil exporters, Other resource-intensive countries, Non-Resource-Intensive countries, Middle income countries, Low income countries, and Countries in Fragile and Conflict-Affected situations etc.
Sub-Saharan Africa has projected GDP growth rate as 4.0% in 2025 when its growth reached negative of -1.6% during covid-19 with the achievement of 3.4% in 2022 and 4.0% in 2023 respectively which clarified as slow but steady progress. Low-income countries showed the best performance with 5.4% in 2023 to 5.7% in 2025 followed by non-intensive resource countries having 5.8% in 2023 with projected rate of 6.1% in 2025, while resource intensive countries projected 3.2% for 2025 having 2.5% in 2023 and the middle-income countries targeted 3.3% in 2025 with 2.6% in 2023.
As regards trading blocs in SSA, WAEMU, COMESA, and EAC-5 achieved reasonable GDP growth rates with higher rates of projections. WAEMU has realized GDP growth rate of 4.9% in 2023,and has planned to grow 6.6% in 2025 while COMESA has achieved 5.7% growth rate in 2023 but will able to grow at 5.6% in 2025 and EAC-5 showed GDP growth rate of 5.3% in 2023 and projected to grow by 5.9% in 2025.Other blocs achieved less than 3% growth rate in 2023 while able to project within 3.5% in 2025 which imply that regional trading blocs growth patterns are divergence ,uneven and low. SSA has engulfed into high inflationary pressure of 10.2% in 2016 and reached inflation rate of 16.2% in 2023 and expected the rate of 12.4% in 2025 where low-income, middle income and oil exporting countries crossed more than 18% and will be able to control under 15% in 2025.In context of regional trading blocs, COMESA and ECOWAS have crossed 20% inflationary rate and expected rate are 15-16% in 2025 which are too high to manage other macro-economic indicators. SACU and WAEMU have performed well to control inflationary pressure within the limit of 5% and projected at more lower rates.
Fiscal deficit as percent of GDP in SSA stood at -4.1% in 2023 and is expected to cut at -3.4% in 2025 where low-income and oil exporting countries performed satisfactory at -3.7% and -2.6% in 2023.All the regional blocs have high fiscal deficit from -4.2% to -5.5% in 2023 and expected to control from -0.9% to -5.9% in 2025 which are not good enough for sustainable development. SSA has been suffering from high public debt which reached at 60.1% of GDP in 2023 and expected to reach at 56.8% in 2025 when income -category countries stood in the ranges from 48.4% to 67.4% in 2023 and are expected to control within 42.2%-64.3% in 2025 while the debt of regional trading blocs reached in the range of 55.2% to 70.6% in 2023 but targeted the rate of range is 47.3% -73.6% which are alarming for self-reliance and public finances. The external debt of SSA is now at 25.6% of GDP in 2023 which is targeted to achieve at 26.5% in 2025 in which oil exporting countries, other resource intensive countries and low and middle income countries performed well within the range of 21.6-25.5% in 2023 and are expected to exist within 22.7-26.2% in 2025.The regional blocs CEMAC,SACU ,and COMESA will belong in the ranges of 21.2-24.1% in 2023 and expected to stay at 21.7-22.7% in 2025 which are good for external stability for SSA although their reserves are able to cover 3-4 months import within 2023 which may be lower at 3.9 months in 2025 where regional trading blocs showed uneven patterns.
IMF has insisted to SSA to speed up multilateral finance inflows, grants and funds, emphasis on inclusive growth, climate finance, capacity development, Poverty Reduction and Growth Trust, long term financial stability. It suggested to tighten monetary and exchange rate stability, structural reform, more FDI inflows, accelerate economic diversification and integrate regional trade patterns with diversification of export destinations. It said that SSA is in full of climate risk and security risk with geo-political instability.
