Economic growth in Sub-Saharan Africa is projected to speed up to 5.6% this year from 4.8% in 2012 and to accelerate further to 6.1% next year, the International Monetary Fund (IMF) said in the April edition of its World Economic Outlook (WEO). The global lender explained that the strong growth in the region would be driven mainly by robust domestic demand, while the uncertain external environment will present the main source of risks to growth, particularly for middle-income and mineral-exporting economies. Domestic demand is seen to be supported by ongoing investment in infrastructure and productive capacity, continuing robust consumption, and the activation of new capacity in extractive sectors.

Africa’s biggest economy, South Africa, is seen as the major underperformer with a projected GDP growth of 2.8% in 2013, accelerating modestly to 3.3% in 2014. South Africa’s economy is affected negatively by sluggish mining production following the 2012 strikes and by weak demand from the eurozone, which is its main export market. The region’s second biggest economy and top oil producer, Nigeria, is expected to expand by 7.2% this year and by 7% next year, buoyed by a rebound from heavy floods in 2012 and an expected implementation of power sector reform. The best performers in 2013 are projected to be Mozambique, the Democratic Republic of Cong (DRC) and Ivory Coast with annual GDP growth rates of above 8%.

The IMF expects Sub-Saharan Africa’s economic growth to strengthen further in 2014, backed by improved activity in South Africa and other middle-income countries, predicated on improvements in the external environment.

The IMF projected some deterioration in the current account balances of a number of countries in the short term, largely due to an expected decline in the terms of trade, especially among oil exporters.

The average annual inflation in the region is expected to fall from 9.1% in 2012 to 7.2% this year and 6.3% next year, absent new fuel and food price shocks.