The Global Crisis and Sub-Saharan Africa

1. The Global Crisis and Sub-Saharan Africa Antoinette M. Sayeh Director African Department

2. Key Messages • The impact of the global crisis on Africa will be severe • African countries are better prepared to address this shock than in the past, but all countries will have to adjust to the new external environment • The IMF is providing scaled-up, more flexible support to Africa

3. African Growth Is Slowing Down

4. How is the crisis affecting Africa? • Countries are affected in different ways • Countries most closely integrated with financial market have felt the impact immediately • Impact more gradual but no less severe in countries primarily affected through real channels • In all countries, fiscal and balance of payment pressures are mounting

5. How are African countries responding ? • A majority is allowing fiscal deficits to widen • But limited fiscal space is a constraint in some countries • Monetary policy has been eased in a number of countries

6. How is the IMF helping (1)? • By strengthening our partnership with Africa • In the joint Dar es Salaam declaration, the IMF and African Finance Ministers committed themselves to a new, enhanced partnership • We are already making progress on these commitments • ongoing reform of our policies in low-income countries • efforts underway to enhance the voice and representation of African countries at the Fund

7. How is the IMF helping (2)? • By scaling up our financial support • Since mid-2008, commitments to Africa have increased by a third to $2.2 billion • By making our lending more flexible • Fiscal targets have been loosened in a majority of program countries • Structural conditionality more focused on core areas of IMF competence • By stepping up our technical assistance effort • Two more regional technical assistance centers in Africa will bring the total to 5

8. Thank you