IMF lowers projections for Mozambique. Angola, Sao Tome; upgrades Cabo Verde, Guinea-Bissau, Equatorial Guinea outlook

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IMF lowers projections for Mozambique. Angola, Sao Tome; upgrades Cabo Verde, Guinea-Bissau, Equatorial Guinea outlook

4:38 CAT | 25 Apr 2025

File photo: AFP

Mozambique’s growth forecast went from 4.3 % in October 2024 to 2.5 % now.

The International Monetary Fund (IMF) has improved the growth forecast for Cabo Verde, Guinea-Bissau and Equatorial Guinea, while worsening the projections for Angola, Mozambique and Sao Tome and Principe.

In the report on the Regional Economic Outlook for Sub-Saharan Africa, released on Friday as part of the World Bank and IMF Spring Meetings, the Fund’s economists make the group of country’s biggest downwards revision in Mozambique. Mozambique’s growth forecast went from 4.3 % in October 2024 to 2.5 % now.

The IMF is, on the other hand, more optimistic about Cabo Verde’s growth, predicting that the archipelago will grow by 5% this year, more than the 4.7% forecast in October, and about Guinea-Bissau, which is seeing a slight increase, from 5% to 5.1%.

The forecast for Equatorial Guinea has improved, but the most recent Lusophone country remains mired in recession, although it has improved from -4.8% to -4.2%.

In the opposite direction, the IMF predicts that Angola will grow by just 2.4%, compared to 2.8% in October, and Sao Tome and Principe has also been revised downwards, albeit slightly, from 3.3% to 3.1%.

Angola, the largest Portuguese-speaking economy in Africa, is expected to see a significant slowdown in economic growth, which last year had expanded by 4.5%.

ALSO READ: World Bank lowers Mozambique’s growth forecast to 3%

At a regional level, the IMF has revised its growth forecast downwards by three tenths to 3.8% this year, due to ‘sudden changes in the global outlook’, which have interrupted growth dynamics.

‘Although growth in Africa is showing some resilience in the face of multiple shocks, sudden changes in the global outlook have disrupted growth momentum,’ according to a statement released at the end of the meeting between IMF Managing Director Kristalina Georgieva and the African Governors Group, led by the Minister of Finance and Budget of the Central African Republic, Hervé Ndoba.

‘The resolute policy actions taken to lower inflation, stabilise public debt and reduce external imbalances risk being undone by future shocks,’ they said, adding that “the risks to the outlook are high, in a context of great uncertainty” in which “fragile and conflict-affected states face particularly serious challenges”.

In the note, the IMF leader and the representative of the 12 African countries said they were ‘resolute in their determination to ensure macroeconomic and financial stability and, at the same time, to fulfil economic development objectives’. On the other hand, they argue that ‘domestic reform efforts should promote fiscal sustainability, especially by mobilising domestic revenue and improving expenditure efficiency’.

READ: Sub-Saharan Africa must lift revenue to ride out global turbulence – IMF Africa head

On Tuesday, the IMF revised down its forecasts for the growth of the world economy, to 2.8% this year, compared to the 3.3% it pointed out in January, and for 2026 the IMF estimates growth of 3%, lower than the 3.3% it also projected in January.

‘The rapid escalation of trade tensions and the extremely high levels of political uncertainty are likely to have a significant impact on global economic activity,’ argues the IMF in its report on the World Economic Outlook, released as part of the Annual Meetings of the World Bank and the IMF, taking place this week in Washington.

YEAR 2025……………………….GDP…….INFLATION

Angola……………………………….2.4………….22.0

Cabo Verde………………………….5.0…………1.5

Guinea-Bissau………………………5.1……….2.0

Equatorial Guinea……………….-4.2……….4.0

Mozambique………………………..2.5……….4.9

Sao Tome and Principe…………3.1……….9.6

Source: Regional Economic Outlook, April 2025

Forecast in October 2024

YEAR 2025…………………….GDP…….INFLATION

Angola……………………………..2.8………21.3

Cabo Verde………………………4.7……….2.0