As the world recovers from the massive economic disruptions caused by the COVID-19 pandemic, many nations are recovering quickly. Not all countries begin from an equal economic basis, however. The nations of Sub-Saharan Africa contain some of the poorest economies in the world. Nevertheless, some Sub-Saharan nations have witnessed tremendous economic growth rates.
Recovering from the Lows of COVID
In 2021 the economies of Africa began their road to recovery from the worst effects of the worldwide pandemic. Overall, African real gross domestic product (GDP) grew at an estimated 6.9 percent, better than the world average. For the Sub-Saharan region, the total was 4.7 percent, still a solid number.
Sub-Saharan Africa has immense natural resources and a young population. These assets have not been fully exploited, but once they are they will contribute to the continuing economic growth of the region.
Nigeria, with its considerable oil resources, has Africa’s largest economy. The government has tightened security around oil facilities, so the oil industry in Nigeria should continue to thrive.
The International Monetary Fund (IMF) expects Angola to remain among the top-growing economies in the region. Angola is fortunate to have both oil reserves and rough diamonds, two extremely valuable commodities. Higher oil prices have benefited the Southern African nation, and the government has taken steps to ensure a sound monetary policy.
While the Democratic Republic of the Congo is fighting against terrorists and insurgents in the northern part of the country, it continues to grow its economy at a steady rate. The nation is large and has ample resources to sustain its recent economic success.
Rwanda is another country successfully rebounding from the pandemic. Its pre-pandemic GDP was just over 10 percent but dropped to 3.5 percent during the first year of the pandemic. In 2023, its GDP could reach 6.7 percent.
The nation of Niger is growing its economy at an impressive rate due in large part to its improving agricultural sector, which now accounts for half of its national economic output. Meanwhile, Senegal is beginning to better exploit its natural mineral resources, with the IMF projecting economic growth of over 8 percent in the coming year.
Challenges to Growth
While 2021 was a great bounce-back year for Sub-Saharan Africa, new challenges emerged in 2022 that harmed economic growth. Some of those factors continue into 2023 and may impede further economic gains.
The most significant problem afflicting economies worldwide is the Russia-Ukraine war. This conflict caused a steep rise in food prices, as both involved nations restricted their exports of key grains in favor of internal consumption. Russia and Ukraine are both major food exporters, and their pullback caused shortages among many countries, especially those in the Middle East that rely almost exclusively on these warring nations for their food supplies.
Food purchases account for over 40 percent of total expenditures for Sub-Saharan countries. Inflation of food costs might well continue due to the continuing war in Ukraine as well as lingering problems in the world supply chain. African nations must invest heavily in domestic agricultural production if they want to keep high food prices from slowing their economic growth.
Government corruption has long been a problem in many African nations. Unfortunately, it continues to cost the populations of these countries billions of dollars annually and blunts the positive economic growth that the entire region has seen recently. There are some good signs, however, such as the removal of the notoriously corrupt and incompetent Zimbabwean dictator Robert Mugabe. The complicated process of decolonization may have occurred decades ago, but its effects, particularly corruption, linger in some African states.
Lastly, while the worst of the COVID-19 pandemic seems to be over, mutated strains of the virus continue to appear. Each new strain seems to bring with it, at least initially, a steep rise in both the infection and death rates. The various COVID-19 vaccines are not as widely available in Sub-Saharan Africa as they are in the United States and Europe, so the region continues to be more vulnerable to new surges and outbreaks. These incidents can cause serious harm to the growing economies of the region and could slow the growth rates of many economies. As the vaccines become more widespread throughout the region, the dangers of further COVID-induced disruptions should subside, but the risk always remains.