Sub-Saharan Africa Near-Term Outlook

By Paul Caruana-Galizia, Neptune Economist

Sub-Saharan Africa’s economic renaissance continues. After growing at an average rate of five per cent over the past decade, the IMF projects an acceleration to 5.5 per cent growth among Sub-Saharan economies in the next two years, as developed economies emerge from the crisis. We expect this growth to be sustainable for three broad reasons.

1. Investment and continued domestic demand
In low-income countries, a move towards political stability is enabling massive investments that will continue to drive domestic demand. Since the end of its civil conflict in 2002, Sierra Leone has made important economic changes, expanding its mining production and increasing its investment in infrastructure. Senegal, which has strengthened its democratic institutions since independence, making it one of Africa’s most stable countries, secured $7.8bn of foreign investment to boost output in agriculture, mining, tourism and logistics as part of its 10-year Emerging Senegal Plan, launched in February 2014… continue reading

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Paul Caruana-Galizia is an economist at Neptune Investment Management

Important information: This is not for retail clients. It is intended for investment professionals and is not for forward transmission.

These are Neptune’s views and as such this document is deemed to be impartial research. We do not undertake to advise you as to any change of our views. This is not a solicitation or an offer to buy or sell our funds. All information is given in good faith but without any warranty. Neptune does not give investment advice and only provides information on Neptune products.

Forecasts are not a reliable indicator of future performance. The value of an investment and any income from it can fall as well as rise as a result of market or currency fluctuation and investors may not get back the amount originally invested. Investments in emerging markets are higher risk and potentially more volatile than those in established markets. Past performance is not a guide to future performance. Some information and statistical data herein has been obtained from sources we believe to be reliable but in no way are warranted by us as to their accuracy or completeness.

Neptune funds may invest more than 35 per cent in government and public securities in a number of jurisdictions.

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