Africa

Africa Data Response

South Africa Manufacturing PMI (Jul.)

South Africa’s manufacturing PMI tanked in July as activity was hit by violent unrest and tighter virus containment measures. And while activity is likely to rebound this month, South Africa’s recovery is likely to continue to lag behind other major EMs.

2 August 2021

Africa Economics Weekly

South Africa’s fiscal tightrope, FX reshuffling in Nigeria

"Post-unrest relief measures announced by the South African authorities will probably go some way to offset the blow to the economy. The government expects to be able to stick to its fiscal consolidation plan, but the path to do so has narrowed again. Meanwhile in Nigeria, the central bank’s move this week to shake up foreign exchange provision in the country risks hurting economic activity and exacerbating inflationary pressures."

30 July 2021

Africa Chart Book

Delta threat building

The highly contagious Delta variant of COVID-19 seems to be dominant now across much of Sub-Saharan Africa and is driving new waves in many of the large economies. South Africa appears to be over the worst of its latest outbreak, although it now has to contend with the legacy of violence and unrest earlier this month. Elsewhere, cases are rising quickly and could dampen recoveries. Extremely low vaccine coverage makes the region particularly vulnerable to this variant and potential future ones. Even in South Africa, where the rollout is quick by regional standards, at the current pace it would take a year for vaccine coverage to reach the levels offering protection against new variants seen in DMs.

29 July 2021

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Africa Data Response

South Africa Manufacturing PMI (Jul.)

Key Forecasts

Table 3: GDP & Consumer Prices (% y/y)

Share of

World 1

2009-18

Ave.

GDP

Inflation

2020

2021f

2022f

2023f

2020

2021f

2022f

2023f

Nigeria

0.81

4.4

-1.8

3.0

2.5

2.7

13.2

16.8

13.3

12.5

South Africa

0.55

1.5

-7.1

4.0

3.5

2.8

3.3

4.3

4.3

4.0

Ethiopia2

0.22

9.7

6.1

2.0

8.0

8.5

20.4

18.5

12.5

10.5

Kenya

0.18

5.6

-0.5

6.5

6.0

5.5

5.4

6.5

5.3

5.5

Angola

0.16

2.4

-5.2

2.5

2.0

2.5

22.3

21.5

16.0

15.0

Ghana

0.13

7.0

0.4

5.0

6.0

5.5

8.8

8.5

8.0

8.0

Tanzania

0.12

6.5

1.5

6.5

6.0

6.5

3.3

3.5

4.5

4.5

Côte d’Ivoire

0.11

6.1

2.5

7.5

7.5

7.0

2.4

3.0

1.5

1.0

Uganda

0.08

5.3

-1.1

6.5

6.0

5.5

2.7

2.8

5.3

5.8

Zambia

0.05

5.6

-3.0

3.0

2.5

2.5

15.7

20.5

9.5

8.0

Botswana

0.03

3.7

-7.9

7.5

6.5

4.0

1.9

5.5

3.5

3.0

Mozambique

0.03

3.7

-1.3

3.5

4.5

5.0

3.1

5.5

5.0

3.5

Rwanda

0.02

7.2

-3.4

9.5

7.5

8.5

7.8

2.5

4.5

4.5

Mauritius

0.02

3.7

-14.9

8.0

7.0

4.5

2.5

2.5

3.5

3.0

Namibia

0.02

3.4

-8.0

4.0

4.5

3.0

2.2

3.5

4.0

4.0

Sub-Saharan Africa

2.5

4.2

-2.2

4.2

4.3

4.2

9.7

11.3

9.0

8.2

Sources: Refinitiv, National Sources, Capital Economics. 1) % of GDP, 2020, PPP terms (IMF estimates); 2) Fiscal Years.


South Africa’s fiscal tightrope, FX reshuffling in Nigeria

Africa Economics Weekly

3 August 2021

Our view

Recoveries from the coronavirus crisis will be held back by scant prospects for speedy vaccine deployment, limited fiscal support and, in the region\'s tourism-dependent economies, a slow return of international visitors. Tailwinds from recent commodity price moves are likely to turn into headwinds in the coming quarters for the region’s key producers. The weak recovery means that interest rates in South Africa will remain low for longer than most currently anticipate. Taken together with a likely watering down of austerity plans, we think the South African rand’s recent rally is likely to go into reverse.

Latest Outlook

Africa Economic Outlook

Recovery in slow motion

Slow vaccine rollouts, tight fiscal policy and weakness in tourism sectors will hold back recoveries across Sub-Saharan Africa. Virus containment measures will probably remain in place for some time, depressing activity. Meanwhile, some countries, like South Africa and Angola, are turning to austerity to tackle worrying debt trajectories. Debt restructuring is already underway in some places and risks remain high in Kenya and Ghana. Elevated commodity prices will provide support to oil producers (Nigeria, Angola), industrial metal exporters (South Africa, Zambia) and gold producers (Uganda, Tanzania). But GDP across most of Sub-Saharan Africa is likely to stay well below its pre-crisis path over 2021-23.

28 April 2021