IMF releases Regional Economic Outlook: Sub-Saharan Africa. Head-scratching ensues.

The IMF has recently released it Regional Economic Outlook (2010-2011) for Sub-Saharan Africa, the link to which may be found here (pdf file). What I find especially curious is the report's suggestion that Africa's national elections have little to no bearing on economic activity in the states in which they transpire. A rather erroneous wedge between politics and economics, I would be inclined to argue.

If one does follow the IMF's claim to its logical conclusion, however, the good news is that the 17 elections* scheduled to take place across the continent over the course of the coming year will have absolutely no impact on neither growth nor general investment prospects in any of these states.

What do we think?

* Countries where major elections in 2011 are planned or have been mooted include Benin, Cameroon, Cape Verde, Chad, Comoros, Democratic Republic of Congo, The Gambia, Liberia, Madagascar, Niger, Nigeria, São Tomé & Príncipe, Seychelles, Swaziland, Uganda, Zambia, and Zimbabwe.

IMF finds Asia's growth projections better than anywhere else

The IMF has recently revised April's World Economic Outlook growth projections for 2009 and 2010. The revised summaries for emerging and developing economies are as follows:

• Growth projections in emerging Asia have been revised upward to 5.5 percent in 2009 and 7.0 percent in 2010. The upgrade owes to improved prospects in China and India, in part reflecting substantial macroeconomic stimulus; and a faster-than-expected turnaround in capital flows. However, the recent acceleration in growth is likely to peter out unless there is a recovery in advanced economies.

• Growth projections for Latin America have been lowered by 1.1 percentage points in 2009, primarily because production has been hit much harder by the global trade slowdown than initially expected. However, the region is benefiting from rising commodity prices, and growth projections have been revised up by 0.7 percentage points in 2010.

• The growth projections for central and eastern Europe and the Commonwealth of Independent States (CIS) have been revised downward by 1.3 and 0.7 percentage points in 2009 and upward by 0.2 and 0.8 percentage points in 2010, respectively. Developments differ appreciably across countries but many have been badly affected by the global financial crisis, with capital flows reversed and commodity exports sharply contracted, although the recent recovery of commodity prices is forecast to raise demand in key CIS economies.

• Growth projections for emerging Africa and the Middle East have been revised downward by 0.3 and 0.5 percentage points in 2009, respectively, while those for 2010 are broadly unchanged. Both regions have been more negatively affected by the drop in global trade than previously expected, with Middle Eastern oil exporters using their financial reserves to prop up domestic demand.

China's growth projection has been revised upwards by 1%, with the country expected to register 8.5% growth in 2010.

[HT: Duncan Green]