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Weak recoveries, default risks still high

Recoveries across Sub-Saharan Africa will be weak, with the region’s three largest economies – Nigeria, South Africa and Angola – set to fare particularly badly. A rebound in tourism sectors has been delayed, low oil prices will weigh on growth in key producers and fiscal support is likely to remain limited. Broad debt relief plans for the region are at an impasse. Most countries will probably end up living with larger debt burdens, with South Africa set to turn to financial repression and Nigeria likely to fire up the central bank’s printing press. But there is a high risk that other stressed sovereigns follow Zambia’s lead and turn to unilateral (and, ultimately, messy) defaults.

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