Press Briefing Transcript: African Department, Annual Meetings 2025
IMF News, October 16, 2025
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- Published: October 16, 2025
Regional growth outlook and macroeconomic environment
- Sub-Saharan Africa economic growth:
- "expected to hold steady at 4.1 percent this year, with a modest pickup expected in 2026."
- Global external conditions noted:
- "weaker demand, softer commodity prices, and tighter financial markets."
- "oil prices are declining while the price of copper, coffee, and gold are fairly elevated."
- External financing and trade landscape:
- "external financing conditions have improved somewhat, allowing a few countries, Kenya and Angola most recently, to access international capital markets."
- "Tariffs on exports to the United States have increased, and preferential access under the Africa Growth & Opportunities Act (AGOA) has expired."
- "The projected sharp decline in foreign aid also leaves some lower-income and fragile countries particularly exposed."
- Inflation and external buffers:
- "inflation that has eased at the regional level but remains in double digits in quite a few countries in the region."
- "external buffers that are under pressure and need to be rebuilt."
Key vulnerabilities and risks
- Debt and domestic financial linkages:
- "about half of the total public debt is held by domestic institutions."
- "we estimate about 20 countries to be in a situation of high risk of debt distress. This comprises about 14 countries at high risk of debt distress and another six in actual debt distress."
- Rising "debt service costs, which are crowding out development spending" and "a shift towards domestic financing that has deepened the Sovereign Bank nexus."
- Aid and financing risks:
- "The projected sharp decline in foreign aid ... leaves some lower-income and fragile countries particularly exposed."
- Countries have "limited fiscal space" to reallocate budgetary resources in response.
- Country-specific notes raised in Q&A:
- Zimbabwe: progress toward restoring macroeconomic stability; "recourse to Central Bank financing has diminished quite a bit."
- Senegal: IMF "have actively started engaging" and "a team that's going to be going to Dakar next week to advance discussions" following government disclosure of problematic public debt numbers.
- Kenya: active "liability management exercise" referenced, including debt redenomination example; staff-level agreement discussions ongoing with missions in Nairobi.
- Ghana: stabilization signs—"the economy is beginning to recover, inflation is beginning to decelerate"—but trade-offs on exchange-rate competitiveness noted.
- Sierra Leone: "impacted the most" by declining ODA; higher domestic borrowing and domestic debt increases described.
- Nigeria: decelerating inflation consistent with tightening monetary policy and exchange rate adjustment; structural reliance on oil and need for domestic revenue mobilization emphasized.
- Rwanda: noted ability to "maintain the microeconomic stability" queried in context of global slowdown and trade policy shifts.
Policy priorities and recommendations
- Domestic revenue mobilization (priority #1):
- Modernize tax systems through digitalization.
- Streamline inefficient tax expenditures.
- Strengthen enforcement via targeted compliance strategies.
- "Build public trust in tax institutions, strengthen institution capacity, and conduct careful impact assessment, including distributional analysis."
- Debt management and public finance (priority #2):
- "Enhancing debt transparency, and strengthening public finance management can help reduce borrowing costs and unlock innovative financing."
- Publish comprehensive public debt data and reinforce budget oversight.
- Encourage active liability management (lengthening maturities, currency/denomination choices) while assessing cross-currency risks and export-currency alignments.
- Ensure robust regulatory frameworks and capitalization plans for banks to limit sovereign-to-bank spillovers.
- Transparency and scrutiny for innovative financing:
- Assess contingent liabilities from securitization of future revenues, PPPs, and similar instruments.
- Prioritize transparency and parliamentary/public scrutiny for novel financing to avoid hidden fiscal risks.
- Balance short-term stabilization and long-term transformation:
- Address macroeconomic imbalances as a prerequisite for sustainable growth, job creation, and long-term investments.
- Use stabilization to create conditions for private investment and structural transformation, including promoting intra‑African trade (AfCFTA) and addressing non-tariff barriers.
IMF engagement and support
- Financial support and capacity development:
- "Since 2020, we have dispersed nearly $69 billion, including about 4 billion so far this year."
- "Capacity development efforts also remain substantial, with countries in the region amongst the largest recipients of technical assistance."
- Country engagement examples:
- Active program discussions initiated with Senegal; mission planned to Dakar.
- Ongoing staff-level discussions and missions in Kenya.
- Continued close engagement with Zimbabwe on policy reforms and reduction of Central Bank financing.
Source: Press Briefing Transcript: African Department, Annual Meetings 2025 (October 16, 2025), IMF Communications Department.