- Downgraded Growth Forecast: The World Bank revises Sub-Saharan Africa's economic growth forecast down from 3.4%
- Regional Economic Contagion: Poses significant risks to neighbouring countries, potentially disrupting trade flows
- Humanitarian and Economic Urgency: The conflict has displaced 11 million people, exacerbated poverty and food insecurity
Harare- Sub-Saharan Africa's economic growth forecast has been revised downwards to 3% for 2024, primarily due to the devastating impact of Sudan's civil war on the region's economy.
This represents a 0.4% drop from the initial forecast of 3.4%. Despite this decline, the growth rate is still expected to surpass last year's 2.4%, driven by increased private consumption and investment.
The war in Sudan reignited in April 2023, following months of escalating tensions between the Sudanese Armed Forces (SAF) and the Rapid Support Forces (RSF), two rival factions that had previously formed an uneasy alliance in the wake of President Omar al-Bashir's ousting in 2019.
The conflict was sparked by longstanding disputes over power sharing, resource allocation, and the integration of the RSF into the regular army. Tensions boiled over when the RSF, led by General Mohamed Hamdan Dagalo, refused to dismantle its forces and integrate into the SAF, leading to clashes in Khartoum and other major cities.
The conflict has since escalated into a full-blown war, displacing millions, exacerbating humanitarian crises, and threatening regional stability.
Sudan's strategic location at the crossroads of Sub-Saharan Africa and the Middle East makes it a significant player in regional politics and trade.
The country shares its border with seven countries: the Central African Republic, Chad, Egypt, Eritrea, Ethiopia, Libya, and South Sudan. Sudan's geography, combined with its rich natural resources, including gold, oil, Arabic gum, and cotton, positions it as a vital component of regional trade.
Sudan's economy is heavily reliant on gold exports, which account for 70% of its total exports, followed by livestock at 25%. China is its main import partner, accounting for 78% of its imports, followed by the UAE, Japan, Saudi Arabia, and Italy.
In 2022, Sudan's exports increased to US$292,137 thousand in December from US$241,933 thousand in November.
The country's top exports include gold ($2.32B), crude petroleum (US$662M), other oily seeds (US$654M), ground nuts (US$425M), and raw cotton (US$379M), primarily to the UAE (US$2.38B), China (US$877M), Italy (US$457M), Egypt (US$429M), and Turkey (US$233M).
Sudan's conflict and economic instability have far-reaching consequences for the region and continent.
Disrupted trade flows affect neighboring countries, particularly Egypt, Ethiopia, and South Sudan.
Regional economic growth is hindered by Sudan's decreased economic output, and Africa's overall economic development is impacted, as Sudan is a significant player in regional trade.
The country's ranking as the world's 88th economy in terms of GDP (current US$), 123rd in total exports, 120th in total imports, 165th in GDP per capita (current US$), and 123rd most complex economy according to the Economic Complexity Index (ECI) underscores its importance.
The ongoing conflict in Sudan highlights the need for African leaders to prioritize their citizens' welfare over personal interests.
Ruling for more than two terms can lead to authoritarianism, conflict, and economic stagnation.
African leaders must embrace democratic values, respect term limits, and prioritize economic development and regional cooperation.
The desire for power and control has driven many African leaders to prioritize their interests over the welfare of their citizens, leading to long-standing grievances, food price hikes, and mass demonstrations.
To achieve lasting peace and stability, Sudan and other African nations must prioritize inclusive governance and representation, economic development and resource sharing, and regional cooperation and conflict resolution mechanisms.
The World Bank forecasts growth to reach 3.9% in 2025, surpassing its previous prediction of 3.8%. However, this optimistic outlook is contingent upon moderating inflation, allowing policymakers to lower elevated lending rates.
Equity Axis News
