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Growth at 15-year low in sub-Sahara

The IMF has cut sub-Sahara Africa’s economic growth fell last year to its lowest level in 15 years as the region reels from multiple shocks of low commodity prices, Ebola virus outbreak and drought.

The International Monetary Fund said on Tuesday economic growth in sub-Saharan Africa fell last year to its lowest level in 15 years in what is blamed on multiple shocks of low commodity prices, Ebola virus outbreak and drought.  

The Fund in its latest economic outlook report for the region said growth is expected to fall to 3 percent in 2016 -- below the six percent average over the last decade and only just above population growth.

It has further called for policy reforms across the region to ensure economic growth in the medium to the long term.

"The steep decline in commodity prices and tighter financing conditions have put many large economies under severe strain," it said, calling for governments to promote long-term growth over short-term policies.

 “Africa needs a substantial policy reset to reap the region’s strong potential. This is particularly urgent in commodity exporters and some market access countries, as the policy response to date has generally been insufficient,” said Antoinette Sayeh, Director of the IMF’s African Department.

Oil exporters Nigeria and Angola were among the worst hit, along with Ghana, South Africa and Zambia.

"A severe drought in several southern and eastern African countries, including Ethiopia, Malawi, and Zimbabwe, is putting millions of people at risk of food insecurity," the report added.

Despite the gloom, the IMF says that economic outlook in the region remains favourable. Ivory Coast, Kenya and Senegal could register growth in excess of 5 percent supported by ongoing infrastructure investment efforts and strong private consumption.

The IMF says that an improved business environment and favorable demographics will also play a supportive role in these economies in the long term.


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