1. Republic of Armenia: 2024 Third Review under the Stand-by Arrangement
The Armenian economy continues to perform strongly, and the outlook is broadly positive. Growth is decelerating gradually to more sustainable levels, as foreign exchange and migrant inflows peter out. Inflation has rapidly declined due to low imported food and energy inflation, Dram appreciation, and tight monetary policy. The uncertain external environment, however, poses sizeable risks, including from a slowdown in main trading partners, geopolitical tensions, and a possible reversal of capital flows. Read More
2. Turkmenistan: 2024 Article IV Consultation
Turkmenistan’s economy slowed in 2023, following a post-pandemic bounce in the previous year. The main economic challenge is to translate hydrocarbon wealth into more diversified, sustainable and inclusive growth.
Achieving this growth transformation will require a market-based diversification strategy, reforms to the monetary and exchange rate frameworks, increased public spending efficiency, and enhanced governance and transparency.
Further improvements in the availability, quality, and reliability of economic statistics would help inform policy makers and increase transparency and credibility.. Read More
3. Republic of Armenia: 2023 Article IV Consultation and Second Review Under the Stand-By Arrangement
Armenia’s growth accelerated in 2022 and remained strong in 2023, boosted by an inflow of foreign exchange, migrants, and businesses, mainly from Russia. Inflation, which peaked in the wake of the war in Ukraine, has quickly subsided. However, the regional security situation worsened significantly in September 2023, after Azerbaijan’s government took full control of Nagorno-Karabakh, which triggered the exodus of about 100,000 ethnic Armenians into Armenia. The government has responded with prompt policy measures to support their immediate needs. Read More
4. Fiscal Impacts of Climate Disasters in Emerging Markets and Developing Economies
Climate-induced disasters are causing increasingly frequent and intense economic damages, disproportionally affecting emerging markets and developing economies (EMDEs) relative to advanced economies (AEs). However, the impact of various types of climate shocks on output growth and fiscal positions of EMDEs is not fully understood. This research analyzes the macro-fiscal implications of three common climate disasters (droughts, storms, and floods) using a combination of macroeconomic data and comprehensive ground and satellite disaster indicators spanning the past three decades across 164 countries. Read More
5. Has the DSSI Helped Lower Sovereign Spreads of Participating SSA Countries?
The DSSI has provided valuable liquidity support to SSA. This note assesses whether it has also helped lower sovereign bond spreads. The results show that the DSSI has lowered spreads of participating SSA frontier markets. Read More
6. Digital currency innovations in Africa: What should policy makers take into consideration?
Policymakers in sub-Saharan Africa are looking to improve financial inclusion and efficiency of payments through digital currencies. Privately issued mobile money such as M-Pesa has long played a momentous role in the region, particularly in East Africa. More recently, fourteen central banks are considering central bank digital currencies. The latest International Monetary Fund’s Regional Economic Outlook for sub-Saharan Africa outlines the promises of digital currencies for the continent and the potential risks. Read More
7. Africa’s Growing Crypto Market Needs Better Regulations
The collapse of the world’s third largest crypto exchange FTX, and subsequent plunge in the prices of Bitcoin, Ethereum, and other major crypto assets, is prompting renewed calls for greater consumer protection and regulation of the crypto industry. Read More
8. Digital Currency Innovations in Sub-Saharan Africa
Sub-Saharan Africa is witnessing a rapid development of digital currencies, and policymakers are weighing the benefits and risks of using these products to deliver financial services. This note discusses three instruments—mobile money, central bank digital currencies (CBDCs), and cryptocurrency. Read More
9. The promise of digital currencies for sub-Saharan Africa
The outlook for sub-Saharan Africa is hostage to a shifting and tumultuous global environment: tighter global financial conditions, a slowdown in advanced and emerging market economies, and volatile food and energy prices. Macroeconomic imbalances including high debt and weak external and fiscal positions are of serious concern for many countries. On the upside, however, a digital revolution is under way across the region, with the potential to propel the region towards a more prosperous and resilient future. Policymakers are considering a number of innovations in the realm of digital currency to bolster payment efficiency. Read More
10. Building a More Food-Secure Sub-Saharan Africa
Sub-Saharan Africa is the most food-insecure region in the world. This note examines the drivers of food insecurity in the region and how countries have responded to the recent food and fuel price shocks. It also outlines short and medium-term policies that are needed to build a more food-secure region in future. Read More
11. Jobs in Lockdown: Insights from Sub-Saharan Africa
Pandemic-induced lockdowns led to sharp drops in formal employment in SSA, with likely even greater losses in the large informal economy. This note uses data on online job vacancies in Ethiopia, Kenya, and Uganda to understand job dynamics during the first lockdown. Read More
12. Seven Charts that Show Sub-Saharan Africa at a Crucial Point
After an unparalleled contraction in 2020, sub-Saharan Africa is set to grow by 3.7 percent in 2021 and 3.8 percent in 2022. The recovery is supported by rising commodity prices, improving global trade and financial conditions. But this welcomed rebound is relatively modest by global standards, leading to a widening income disparity with developed economies. Read More
13. Regional Economic Outlook for SSA: One Planet, Two Worlds, Three Stories (October 2021)
The world remains in the grip of the COVID-19 pandemic and a seemingly accelerating pace of climate change, both of which underscore the need for increased global cooperation and dialogue. Solutions to these global problems must involve all countries and all regions, especially sub-Saharan Africa, with the world’s least vaccinated population, most promising renewable energy potential, and critical ecosystems. Read More
14. Regional Economic Outlook for SSA: Navigating a Long Pandemic (April 2021)
Despite turning out better than expected, growth in 2020 is estimated to be the worst on record, at –1.9 percent, leading to a large increase in poverty. In 2021, the region’s economy is expected to resume expansion at 3.4 percent, weaker than the 6 percent for the rest of the world, amid a continued lack of access to vaccines and limited policy space to support the crisis response and recovery. Read More
15. Regional Economic Outlook for SSA: A New Shock and Little Room to Maneuver (April 2022)
The economic recovery in sub-Saharan Africa surprised on the upside in the second half of 2021, prompting a significant upward revision in last year’s estimated growth, from 3.7 to 4.5 percent. This year, however, that progress has been jeopardized by the Russian invasion of Ukraine which has triggered a global economic shock that is hitting the region at a time when countries’ policy space to respond to it is minimal to nonexistent. Read More
16. More African Central Banks Are Exploring Digital Currencies
Several sub-Saharan African central banks are exploring or in the pilot phase of a digital currency, following Nigeria’s October introduction of e-Naira. Nigeria was the second country after the Bahamas to roll out a CBDC. CBDCs are digital versions of cash that are more secure and less volatile than crypto assets because they are issued and regulated by central banks. As the Chart of the Week shows, South Africa and Ghana are running pilots while other countries are in the research phase. Read More
17. Kingdom of Lesotho: 2022 Article IV Consultation Report
Lesotho has been simultaneously hit by the pandemic, declining transfers from the Southern African Customs Union (SACU), and the impact of the war in Ukraine. The pandemic exacerbated the impact of sluggish regional performance, climate shocks, and longstanding structural issues such as regulation, governance, political stability, financial inclusion, and diversification. Public expenditure has continued to increase, such that the decline in external transfers precipitated significant financing pressures and growing domestic arrears. With limited inflows to the private sector, the resulting public sector-driven external imbalances have continued to put pressure on international reserves needed to maintain the exchange rate peg. Read More
18. Africa’s Rapid Economic Growth Hasn’t Fully Closed Income Gaps
Many economies in sub-Saharan Africa grew at a record pace before the pandemic. Ethiopia and Rwanda, for example, saw some of the fastest expansions in the world—an average of more than 7.5 percent per year over the past two decades. However, it is less clear whether the gains in economic growth have been shared equally across regions within countries because income data at the subnational level are not always available. Read More
19. Regional Inequalities in Sub-Saharan Africa
This study analyzes inequalities across subnational regions within sub-Saharan African countries, documenting a marked decline before 2010, a slowdown afterward and a partial reversal during the COVID-19 pandemic. It also finds persistently large disparities in crucial socioeconomic aspects. It outlines policies and strategies to support lagging regions catch up. Read More
