Rising BRICs and Changes in Sub-Saharan Africa’s Business Cycle Patterns

Author/Editor: Oumar Diallo ; Sampawende J.-A. Tapsoba
Publication Date: February 14, 2014
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Disclaimer: This Working Paper should not be reported as representing the views of the IMF. The views expressed in this Working Paper are those of the author(s) and do not necessarily represent those of the IMF or IMF policy. Working Papers describe research in progress by the author(s) and are published to elicit comments and to further debate
Summary: This paper assesses the extent to which Sub-Saharan Africa (SSA)’s business cycle is synchronized with that of the rest of the world (RoW). Findings suggest that SSA’s business cycle has not only moved in the same direction as that of the RoW, but has also gradually drifted away from the G7 in favour of the BRICs. Trade with the BRICs turns out to be the strongest driver of this shift. Much of this impact unfolds through aggregate demand impulse from trade. As fiscal policy stances in SSA and the BRICs are not synchronized, they have not caused cyclical output correlation between these two groups of countries. Also, financial openness, which is at a very early stage across most SSA countries, has acted as a neutral force.
Series: Working Paper No. 14/35
Subject(s): Business cycles | Brazil | Russian Federation | India | China | Sub-Saharan Africa | Trade integration | Demand | Fiscal policy | Economic models

Publication Date: February 14, 2014
ISBN/ISSN: 9781484306598/1018-5941 Format: Paper
Stock No: WPIEA2014035 Pages: 26
US$18.00 (Academic Rate:
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