In 2025, headline inflation will still be significantly higher in Sub-Saharan Africa (SSA) oil exporting nations than in the rest of the continent, according to the International Monetary Fund (IMF), which has also hinted at why median inflation will somewhat drop in Nigeria, Angola, and Ghana.
The IMF’s most recent Regional Economic Outlook (REO) for sub-Saharan Africa, titled “Reforms Amid Great Expectations,” stated that while macroeconomic vulnerabilities still exist, ongoing reforms in the SSA region are paying off. The multilateral lender also predicted a 3.2% GDP growth for Nigeria in 2025.
According to the research available to the BrandSpur digital news platform, GDP headline inflation is predicted to keep declining. It partly reads: “The regional GDP-weighted headline inflation is projected to decline substantially, from 18.1 percent in 2024 to 12.3 percent in 2025, with significant decreases
“In Angola, Ghana, and Nigeria, median inflation will decline slightly, from 4.7 percent to 4.5 percent,” it further reads.
Nonetheless, oil exporters will continue to experience far greater inflation than the rest of the area. South Sudan, Nigeria, Gabon, Equatorial Guinea, Congo, Angola, Cameroon, and Chad are the Sub-Saharan African nations that export oil.
In September 2024, the inflation rate in Nigeria was 33.4%. According to the research, as monetary policy has tightened to combat inflation, policy changes have assisted in reducing both domestic and foreign imbalances. The IMF clarified that most countries are seeing a decrease in inflation as a result of the measures and that in around half of the nations, inflation is already below or within the target zone.
In 2023, the median primary fiscal deficit shrank by 1.3 percentage points of GDP, with more than two-thirds of nations consolidating their fiscal accounts (with noteworthy reductions in Côte d’Ivoire, Ghana, and Zambia among others). It pointed out that countries in the region were attempting to implement challenging and necessary reforms to restore macroeconomic stability in the wake of repeated negative shocks and the resulting need for support, highlighting the fact that Sub-Saharan Africa is navigating a complex economic landscape marked by both progress and persistent macro-economic vulnerabilities.
Overall, both external and domestic imbalances have begun to decrease, primarily as a result of policy changes, but the situation is not uniform; according to the IMF, over half of nations still have significant imbalances.
However, it further stated that considerable fiscal consolidation has steadied the average debt-to-GDP ratio, albeit at a high level, even while monetary tightening has reduced inflation, which is within target in almost half of the region.
