## Africa: Is This the Turning Point?

_IMF Policy Discussion Papers, May 1, 1998_

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## Bibliographic details
- Authors: Mohsin S. Khan, Stanley Fischer, Ernesto Hernández-Catá
- Published: May 1, 1998
- Series: IMF Policy Discussion Papers
- DOI: https://doi.org/10.5089/9781451972061.003

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### Main question and scope
- Examines whether Sub-Saharan Africa (SSA) is at a turning point in its economic fortunes.
- Focuses on drivers needed to sustain a high rate of growth in SSA.

### Key findings on recent growth dynamics
- Recent improvement in growth reflects in part a rise in the utilization of existing capacity.
- Sustaining a high rate of growth will require:
  - an increase in investment rates and/or
  - an increase in total factor productivity (improvements in the technological, political, administrative and economic factors that raise the rate of return on both capital and labor).

### Empirical evidence and quantitative relationship
- The close link between investment and growth in developing countries over the long term is evident in the empirical growth literature.
- For developing countries in general, the elasticity of growth with respect to the investment/GDP ratio has been found to lie within the range of 0.3–0.5.

### Policy implications and recommendations
- Increasing investment is crucial to sustain higher growth in SSA.
- Complementary actions are needed to raise productivity and growth, including improvements in:
  - technological factors,
  - political and administrative environments,
  - economic policies that raise rates of return on capital and labor.

*Source: Africa: Is This the Turning Point? by Mohsin S. Khan, Stanley Fischer, Ernesto Hernández-Catá (IMF Policy Discussion Papers), May 1, 1998.*

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_Source: https://www.imf.org/en/publications/imf-policy-discussion-papers/issues/2016/12/30/africa-is-this-the-turning-point-2580_