Financial rating agency Fitch Ratings predicts growth of 4 per cent in sub-Saharan Africa in 2024, with inflation in the region slowing to 4.9 per cent and public debt remaining at 67 per cent.
“We expect average growth in sub-Saharan Africa in 2024 to remain at around 4 per cent, which is in line with the five-year average up to 2019, although it is lower than the growth trend up to 2014, which was stronger,” the analysts write in a report on the outlook for the region in 2024, in which they say the ratings trend is neutral.
In the document, sent to clients and to which Lusa has had access, Fitch Ratings points out that despite average growth of around 4 per cent, “there are substantial divergences”, since seven of the 20 countries assessed will grow at levels equal to or greater than 5.5 per cent.
“The main risks are related to financing restrictions, climatic events and the possibility of lower than expected global growth,” which could influence the expansion of African economies.
Fitch, which issues an opinion on the credit quality of Portuguese-speaking Angola, Cape Verde and Mozambique, foresees an improvement in average inflation in the region, after the sharp rise in 2022 to 7.4 per cent, which should slow to 6.3 per cent this year and 4.9 per cent next year.
Despite the “significant variations” between the 20 countries analysed, Fitch Ratings points out that Angola, Ethiopia, Ghana and Nigeria should be some of the countries where prices will rise by more than 10% in 2024.
With regard to public debt, one of the main concerns of analysts and international economic institutions, Fitch predicts that it will stabilise at 67%, anticipating the continuation of budget consolidation efforts, in many cases with programmes from the International Monetary Fund, which cover 13 of the 20 countries that have a rating from Fitch.
“The debt-to-GDP ratio, at 67 per cent, remains 10 percentage points higher than it was in 2019, before the pandemic, and is more than double the figure below 30 per cent recorded between 2007 and 2013,” reads the report, which notes that half of the countries with a Fitch rating have public debt above 70 per cent of GDP.
“The average debt-to-revenue ratio will remain above 300 per cent, more than double that recorded in 2013,” which means that the taxes collected by the state only cover around a third of the cost of servicing the debt, the analysts conclude.
