Seeking success in Sub-Saharan Africa

Like much of the rest of the world, Sub-Saharan Africa was hit hard by the Coronavirus pandemic, with infections reaching more than 100 000 a week in mid-2020. Despite this unprecedented health crisis, efforts made by regional authorities ensured that cases began to ease and hopes were placed on a gradual recovery. However, as the International Monetary Fund (IMF) reports in its regional economic outlook for Sub-Saharan Africa, the arrival of the more contagious Beta and Delta variants and subsequent second and third ‘waves’ (with more than 210 000 infections a week being recorded) dashed hopes that the pandemic was over.

Indeed, a return to normalcy will be far from easy for Sub-Saharan Africa. Lockdowns have become less stringent as governments come under pressure to support economic activity, and the pace of vaccination in the region remains significantly slower than other regions. For this latter issue, the IMF places the blame squarely on stockpiling and export restrictions put in place by advanced economies and major vaccine producing countries. Despite all of this, however, the IMF still expects the region to show growth of 3.7% in 2021 and 3.8% in 2022 – a marked improvement on the 6.4% contraction of 2020, but still lower than many other areas of the world.

Regional highlights

Nigeria

Nigeria is one of the economic powerhouses of the Sub-Saharan region, with its population of 202 million accounting for nearly half of all people in West Africa. According to the World Bank, in 2020 Nigeria fell into its deepest recession in nearly two decades as oil prices plummeted and pandemic restrictions hampered trade. In 2021 however, growth has returned as restrictions have eased and oil prices have risen again. GlobalData reports that the country’s construction sector is forecast to grow by 3.9% in 2021 as the Nigerian government passed a long-awaited Petroleum Industry Bill, which provided impetus for the oil and gas sector and created multiplier effects across the entire construction chain. In February, President Buhari approved the development of an infrastructure company, Infra-Co, as part of a public-private partnership, with an initial capital of US$2.7 billion and the goal of focusing primarily on the country’s infrastructure development.

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