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Zambia, Côte d’Ivoire and Ghana were among the African countries making significant strides in fiscal consolidation in 2023, with the median primary fiscal deficit narrowing by 1.3 percentage points of Gross Domestic Product (GDP), according to the IMF’s latest Economic Outlook for Sub-Saharan Africa.
The report highlighted that over two-thirds of African countries achieved fiscal consolidation last year, with further improvements expected in 2024.
The median debt-to-GDP ratio, though high at 58 percent, has stabilised and the IMF projects continued fiscal adjustments through 2025 to rebuild buffers and reduce debt burdens.
Additionally, more than two-thirds of African nations are projected to consolidate public finances in 2025, with a balanced approach between expenditure cuts and tax reforms.
Resource-intensive countries (RICs) are expected to focus heavily on spending reductions, making up 75 percent of their fiscal adjustment efforts.
The IMF also noted that countries like Cameroon, Guinea-Bissau, Madagascar, Senegal, and Tanzania aim to boost revenues by expanding their tax base, reducing exemptions, and digitalizing tax administration.
The median current account deficit is expected to drop from 4.3 percent in 2024 to 3.7 percent in 2025, with improvements in the external position forecast for more than 60 percent of deficit-running countries.
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