## Sub-Saharan Africa: One Planet, Two Worlds, Three Stories

_IMF News, October 21, 2021_

## Source details

**Canonical URL:** [Sub-Saharan Africa: One Planet, Two Worlds, Three Stories](https://www.imf.org/en/news/articles/2021/10/20/pr21306-sub-saharan-africa-one-planet-two-worlds-three-stories)

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## Bibliographic details
- Published: October 21, 2021

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### Growth projections and short-term outlook
- Sub-Saharan Africa is projected to grow by 3.7 percent in 2021 and 3.8 percent in 2022.
- The recovery at 3.7 percent in 2021 will be the slowest in the world, while advanced markets grow by more than 5 percent and other emerging markets and developing countries grow by more than 6 percent.
- The rebound in 2021 primarily reflects a favorable external environment, including a sharp improvement in trade and commodity prices, and improved harvests lifting agricultural production.
- The outlook remains highly uncertain and depends on progress in the fight against COVID-19 and is vulnerable to disruptions in global activity and financial markets.

### Divergence across and within countries
- Real per capita income is expected to remain close to 5½ percent below precrisis trends.
- Permanent real output losses are projected to range between -21 percent and -2 percent.
- Non-resource-intensive countries are growing much faster than resource-rich countries; this pattern predates the crisis and has been amplified by recent events.
- The crisis has widened gaps within countries, with about 30 million people thrown into extreme poverty.
- Rising food price inflation, combined with reduced incomes, threatens past gains in poverty reduction, health, and food security and may exacerbate social and political instability.

### Debt dynamics and fiscal space
- Public debt is predicted to decline slightly in 2021 to 56.6 percent of GDP but remains high compared to a pre-pandemic level of 50.4 percent of GDP.
- Half of sub-Saharan Africa’s low-income countries are either in or at high risk of debt distress.
- Debt-service payments are accounting for an increasing share of government resources, increasing pressure on countries’ fiscal positions.

### Policy challenges and priorities
- Policymakers face three key fiscal challenges:
  - to tackle the region’s pressing development spending needs;
  - to contain public debt; and
  - to mobilize tax revenues in circumstances where additional measures are generally unpopular.
- For most countries, urgent policy priorities include:
  - spending prioritization;
  - revenue mobilization;
  - enhanced credibility; and
  - an improved business climate.
- The recent SDR allocation has boosted the region’s reserves and easing some burdens; rechanneling SDRs from countries with strong external positions to countries with weaker fundamentals could help bolster the region’s resilience.
- On COVID-19, international cooperation on vaccination is critical to prevent repeated waves and avoid hardening divergent recovery paths between sub-Saharan Africa and the rest of the world.

### Long-term outlook and structural considerations
- The region’s vast potential remains undiminished, but the threat of climate change and the global energy transition imply a need for a more innovative and greener growth model.
- Achieving this transition will require bold transformative reforms and continued external funding; such measures are key prerequisites for realizing long-promised development goals.

*Press Release No. 21/306 — October 21, 2021. International Monetary Fund*

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## References

- [Abebe Aemro Selassie](https://www.imf.org/en/About/senior-officials/Bios/abebe-selassie)
- [IMF COVID-19 Hub](https://www.imf.org/en/Topics/imf-and-covid19)
- [Policy Tracker](https://www.imf.org/en/Topics/imf-and-covid19/Policy-Responses-to-COVID-19)
- [Financial Assistance](https://www.imf.org/en/Topics/imf-and-covid19/COVID-Lending-Tracker)
- [Questions & Answers](https://www.imf.org/en/About/FAQ/imf-response-to-covid-19)
- [Press Releases](https://www.imf.org/en/news/searchnews)
- [PRESS CENTER](http://presscenter.imf.org/)
- [Regional Economic Outlook for Sub-Saharan Africa](https://imf.org/AfricaREO-Oct21)
- [https://www.imf.org/en/home](https://www.imf.org/en/home)

_Source: https://www.imf.org/en/news/articles/2021/10/20/pr21306-sub-saharan-africa-one-planet-two-worlds-three-stories_