World Economic Outlook April 2023. Source: International Monetary Fund.
Mr David Malpass, World Bank Group President, said the diversion of natural gas to Europe presented grave obstacles to developing countries’ production of electricity, fertilizer, and food.
“These problems are severely constraining future growth and deepening inequality and fragility for developing countries.
“I travelled to West Africa in March, where we are working to provide support in the face of these problems”, he said.
Malpsss, during a news conference in the course of the meetings called on the incoming government in Nigeria to tackle trade protection that blocks importation; address dual exchange rates; and diversify the economy to achieve shared prosperity and sustainable growth.
The Bank’s President said in the Group’s forecast, Nigeria’s growth was 3.3 per cent in 2022 and 2.8 per cent in 2023.
Malpass went on to advise policymakers in Nigeria and other SSA countries to focus on policies that would enhance inclusive growth.
Ms Kristalina Georgieva, Managing Director, IMF, and Mr Olavo Correia, Cape Verde’s Finance Minister and Chair of the African Caucus in a joint statement after the meetings, said strengthening social protection is key to Africa’s development.
They also said leveraging digital infrastructure, such as mobile phone platforms, could help to increase efficiency and ensure social support was well targeted to the most vulnerable.
The group said in shock-prone environments such as Africa building resilience, including to climate change, remained fundamental.
“Mobilising additional external financing to support the recovery remains critical”, they said.
Georgieva said IMF was aware of the implications of external debt on the economy of African nations particularly the SSA countries would continue to provide technical assistance to them to mitigate the impact.
“The IMF continues to explore ways to make debt resolution more efficient. To this end, the IMF, together with the World Bank and the India G20 Presidency, have launched a Global Sovereign Debt Roundtable.
“The IMF remains steadfastly committed to the region and continues to work towards ensuring that its concessional lending toolkit for low-income countries is flexible, effective, and well-resourced.
“The Resilience and Sustainability Trust is now operational, providing longer-term affordable financing to address longer-term challenges, including climate change and pandemic preparedness.
“Rwanda is one of the first beneficiaries, with several other countries in the pipeline”, she said.
Nadia Calviño, the Chair of the International Monetary and Financial Committee said the meetings resolved enhanced commitment by members to ” coordinate our economic policies and to reinforce our global financial safety net.
“The meetings also resolved to work together in a constructive manner to deliver on our shared roadmap as we start the road to the Annual Meetings in Marrakesh.
The meetings have outlined and suggested pragmatic policies for the SSA region to cushion the effects of the global crisis as well as build external resilience and ensure sustainable growth.
Experts say the onus is on the governments and policymakers in the region to tailor these policies based on their peculiar challenges to steer the continent on the right economic trajectory.
They say it is also important for Bretton Woods Institutions to effectively implement resolutions at their meeting to stimulate economic growth and alleviate poverty in Sub-Saharan Africa countries.