On 17 April 2026 the IMF held a press briefing on the Regional Economic Outlook for Sub Saharan Africa: Hard Won Gains Under Pressure.
The IMF notes that Sub-Saharan Africa performed strongly in 2025, with regional growth estimated at around 4.5%, reflecting favourable external factors and policy decisions. Inflation was more moderate at the end of 2025 and fiscal positions improved, supported by stronger growth and favourable exchange rate developments. However, the gains made recently are now under pressure. The war in the Middle East has caused sharp increases in oil, gas, and fertilizer prices, as well as shipping costs. The economic shock has disrupted the trade with Gulf countries, reduced tourist arrivals, and may affect remittances to some countries.
Economic growth in the region is expected to reach 4.3% in 2026, 0.3 percentage points lower than the previous IMF forecast, with significant differences across countries. Oil-importing, non-resource-rich countries will be hit by a deterioration in the trade balance and a higher cost of living. Oil exporters in the region will receive stronger export revenues but are vulnerable to volatility and policy risks.
Downside risks are significant as there is high global uncertainty. A prolonged conflict would further increase oil, fertilizer, and food prices and potentially raise borrowing costs. Countries should focus on addressing the economic shock in the near term and building more resilience in the medium term. Vulnerable population groups should be protected from higher living costs through targeted, temporary support.
More regional integration can increase economic growth and improve supply-chain resilience. Further progress should be made on the African Continental Free Trade Area agenda. This should include reducing non-tariff barriers, modernizing customs procedures, and deepening trade in services. In this way trade costs can be lowered and larger and more diversified markets created for local goods and services.
More progress is needed with digitalization, including low-cost artificial intelligence (AI) applications in revenue administration, service delivery, and financial inclusion. This needs to be accompanied by investments in energy grids, connectivity, cybersecurity, data governance and relevant skills.
The IMF notes that readiness for use of AI in the region is below that of many other emerging markets, reflecting gaps in infrastructure, skills, and governance capacity. AI is however being adopted for problem-solving applications in key sectors, with scope for productivity gains and improved service delivery. The use of AI can raise efficiency by augmenting workers’ capabilities, improving decision making, and lowering transaction costs. In public administration, AI-enabled analytics can also strengthen tax and customs compliance, improve risk targeting and support more effective delivery of social assistance.
A section of the IMF report deals with the consequences of the cuts to foreign aid in the past year. Sub-Saharan Africa is the largest global recipient of aid, and the cuts to aid in 2025 have hit low-income countries and fragile and conflict-affected states the hardest. The traditional buffers, such as multilateral institutions and nongovernmental organizations (NGOs) are themselves under pressure and unable to step in to fill the gaps. Following six years of successive economic shocks, domestic fiscal conditions are very tight, leaving little room to manoeuvre. In this situation the priorities are to protect and prioritise high-impact aid, strengthen coordination and broaden the development finance toolkit. Countries must deepen domestic and regional capacity to design policies, mobilize resources and deliver services.
Well-designed and broad-based structural reforms can deliver significant socioeconomic improvements, enhancing service delivery and bringing higher living standards. The IMF emphasises that reforms need to be tailored to each country’s circumstances, carefully sequenced and implemented with stakeholder engagement and clear communications. To maintain growth, private investment should be crowded in. The priorities are to deepen financial markets, liberalise trade and remove the remaining regulatory barriers to investment and innovation. Stronger governance, enhanced accountability, secure property rights and improved contract enforcement are important to restore confidence. Attention should also be given to the reform of state-owned enterprises.
