A week ago, the International Monetary Fund (IMF) held a public presentation on the October issue of the Sub-Saharan Africa Regional Economic Outlook (REO). From some headlines, the outlook looks good—or better than expected. According to the report, Sub-Saharan Africa (SSA) is on a “steady recovery path”.
But that’s the problem with headlines. It’s impossible to capture the nuance of even a 30-page report.
If we believe the headlines, we are on a steady recovery path that includes the slowest vaccine rollout in the world, with only 4% of the SSA population fully vaccinated. A permanent drop in real income means the region would have to grow twice as fast in the next three years to match the recovery of advanced economies. And a deepening fiscal policy trilemma.
What is this trilemma? Many SSA countries (Nigeria included) are facing a combination of rising development-spending needs, ballooning public debts, and continued resistance to growing tax revenue.
This is what a “steady recovery path” looks like.