Negative outlook for sub-Saharan Africa remains – Fitch
Continued fiscal and external pressures, compounded by rising government debt, weak economic growth and political instability in some countries, is keeping the 2017 ratings outlook negative for sub-Saharan Africa.
However, some of the growth-offsetting factors, such as lower commodity prices, drought in some parts of the continent and foreign-exchange shortages in Angola and Nigeria, are expected to fade in 2017.
Ratings agency Fitch Ratings on Tuesday forecast a rise in aggregate sub-Saharan African growth from 0.9% in 2016, weighed down by poor performance in Angola, Nigeria and South Africa, to 2.9% in 2017.
“While commodity prices have regained some ground, many commodity exporters in the region are still running substantial budget and current account deficits and are facing financing strains and pressures on foreign-exchange reserves at current levels. They face further fiscal consolidation in 2017 to narrow twin deficits and stabilise their economies,” the agency said.
Fitch noted that government debt ratios would continue an upward trend across most of the region, adding that heavy spending on infrastructure, weak public financial management and the decline in commodity prices would remain important drivers of elevated budget deficits, and that political risks would also remain an important rating factor in the region.
“Instability in government will affect the ability to tackle economic policy challenges and, more seriously, social and political challenges [facing] government,” it said.
“This will put pressure on expenditure and affect the confidence of foreign investors in a number of sovereigns, such as Ethiopia, where unrest has led to the imposition of a state of emergency, or Kenya, where tensions have risen ahead of elections in 2017,” Fitch concluded.
Comments
Press Office
Announcements
What's On
Subscribe to improve your user experience...
Option 1 (equivalent of R125 a month):
Receive a weekly copy of Creamer Media's Engineering News & Mining Weekly magazine
(print copy for those in South Africa and e-magazine for those outside of South Africa)
Receive daily email newsletters
Access to full search results
Access archive of magazine back copies
Access to Projects in Progress
Access to ONE Research Report of your choice in PDF format
Option 2 (equivalent of R375 a month):
All benefits from Option 1
PLUS
Access to Creamer Media's Research Channel Africa for ALL Research Reports, in PDF format, on various industrial and mining sectors
including Electricity; Water; Energy Transition; Hydrogen; Roads, Rail and Ports; Coal; Gold; Platinum; Battery Metals; etc.
Already a subscriber?
Forgotten your password?
Receive weekly copy of Creamer Media's Engineering News & Mining Weekly magazine (print copy for those in South Africa and e-magazine for those outside of South Africa)
➕
Recieve daily email newsletters
➕
Access to full search results
➕
Access archive of magazine back copies
➕
Access to Projects in Progress
➕
Access to ONE Research Report of your choice in PDF format
RESEARCH CHANNEL AFRICA
R4500 (equivalent of R375 a month)
SUBSCRIBEAll benefits from Option 1
➕
Access to Creamer Media's Research Channel Africa for ALL Research Reports on various industrial and mining sectors, in PDF format, including on:
Electricity
➕
Water
➕
Energy Transition
➕
Hydrogen
➕
Roads, Rail and Ports
➕
Coal
➕
Gold
➕
Platinum
➕
Battery Metals
➕
etc.
Receive all benefits from Option 1 or Option 2 delivered to numerous people at your company
➕
Multiple User names and Passwords for simultaneous log-ins
➕
Intranet integration access to all in your organisation