RateCaptain
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
  • Contact Us
No Result
View All Result
Subscribe
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
  • Contact Us
No Result
View All Result
RateCaptain
No Result
View All Result
Home Economy

Income inequality persists in Africa despite rapid economic growth over the years – IMF

Rate Captain by Rate Captain
September 23, 2022
in Economy
Reading Time: 2 mins read
A A
0
Income inequality persists in Africa despite rapid economic growth over the years – IMF
Share on FacebookShare on TwitterShare on WhatsappShare on Telegram

The International Monetary Fund (IMF) has stated that despite rapid economic growth in sub-Sahara Africa, regional income gaps haven’t fully closed as lagging regions on the continent fall short of access to infrastructures like water, electricity, and cell phone services to name a few.

This is according to a news release by the IMF on its website

AlsoRead

IMF raises Nigeria’s economic growth forecast to 3.2% in 2023.

Currency in circulation drops massively in the third quarter of 2022.

Nigeria’s Debt Position caused Moody’s downgrade.

Before the pandemic, many sub-Saharan African economies grew at a historic pace with some countries having some of the fastest economic expansion in the world. Notably, Ethiopia and Rwanda had an average of over 7.5 percent growth per year over the past two decades, according to IMF.

According to data from the IMF, until 2010, African countries made significant progress in narrowing regional income inequality (differences in output per capita across regions of a country), a time when other parts of the world saw inequality either increasing or converging slowly.

However, not all regions saw a reduction in income gaps. Furthermore, in some countries that previously experienced decades of growth, progress stalled after 2010, with regional inequalities having widened post-pandemic.

What the IMF is saying
For Africa to close its regional inequality gap, IMF pointed to some factors which it identified to have supported the reduction of inequality over the past few decades.

The fund identified macroeconomic stability as a major force in improving inequality in Africa. It said, ”Inequality tends to increase in countries with high, persistent inflation by eroding the purchasing power of consumers, reducing government spending in real terms and disincentivizing private investment.”

Trade openness was also cited as a key factor in closing inequality gap. The fund stated that “easier access to global markets supports convergence by increasing the value of a country’s resources like raw materials, which are more abundantly available in lagging regions. It also brings more workers into urban centers, which could, in turn, lead to a decline in income per capita of more urbanized regions if infrastructure development and the overall increase in economic activity in city centers are unable to keep up.”

“Strong institutions and political stability: Weak institutions impede the capacity of governments to provide services and civil wars destroy public infrastructure, raising the likelihood that regions are left behind.”

“Well-targeted investments: We used mineral discoveries as a proxy for analyzing the impact of investments on regional inequality and found that progress depends on the location. Investments that occur outside of the capital cities are the most likely to have an impact by creating jobs and promoting economic activity in lagging regions.”

IMF proposed the need for policymakers in Africa to resort to an all-inclusive policy framework. Closing the inequality in Africa will require macroeconomic stability that will give rise to inclusive growth. Also, a fashionable redistributive fiscal policy with a clear investment strategy to assist underserved regions, while strengthening institutions to ensure political stability and equitable public service delivery will further fuel this agenda.

Previous Post

Binance Exchange Enlists Ibukun Awosika on its Global Advisory Board

Next Post

Nigeria needs help to tackle its debt burden – AFDB

Related News

IMF raises Nigeria’s economic growth forecast to 3.2% in 2023.

IMF raises Nigeria’s economic growth forecast to 3.2% in 2023.

by Rate Captain
February 2, 2023
0

The International Monetary Fund (IMF) has recently raised Nigeria’s economic growth forecast to 3.2 percent for 2023 due to improved...

Currency in circulation drops massively in the third quarter of 2022.

Currency in circulation drops massively in the third quarter of 2022.

by Rate Captain
February 1, 2023
0

Following the Central Bank of Nigeria’s (CBN) new naira policy to manage currency in circulation in the country, the currency...

Nigeria’s Debt Position caused Moody’s downgrade.

Nigeria’s Debt Position caused Moody’s downgrade.

by Rate Captain
February 1, 2023
0

Moody’s has downgraded Nigeria’s long-term foreign currency, local-currency issuer ratings, and foreign currency senior unsecured debt ratings to Caa1 from...

Nigeria’s public debt stock grew to 2.84% in Q3 2022.

Nigeria’s public debt stock grew to 2.84% in Q3 2022.

by Rate Captain
January 31, 2023
0

Nigeria’s public debt stock increased from N42.84 trillion (103.31 billion dollars) in the second quarter of 2022 to N44.06 trillion...

Next Post
Nigeria needs help to tackle its debt burden – AFDB

Nigeria needs help to tackle its debt burden - AFDB

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Recommended

Airtel Africa’s nine-month turnover hits $3.9billion.

Airtel Africa’s nine-month turnover hits $3.9billion.

February 3, 2023
Charges on cash transactions skyrocketed by POS agents.

Charges on cash transactions skyrocketed by POS agents.

February 3, 2023

Popular Story

  • Shell’s annual profit hits $39.9 billion.

    Shell’s annual profit hits $39.9 billion.

    0 shares
    Share 0 Tweet 0
  • Charges on cash transactions skyrocketed by POS agents.

    0 shares
    Share 0 Tweet 0
  • Airtel Africa’s nine-month turnover hits $3.9billion.

    0 shares
    Share 0 Tweet 0
  • Naira appreciates to N746/$ in the parallel market.

    0 shares
    Share 0 Tweet 0
  • MTN Nigeria Annual profit hits N361.5 billion.

    0 shares
    Share 0 Tweet 0
RateCaptain

RateCaptain

We bring you the most accurate in new and market data. Check our landing page for details.

  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
  • Contact Us

Copyright © 2022 RateCaptain - All rights reserved by RateCaptain.

No Result
View All Result
  • FX Rates
  • Money Market
  • Cryptocurrency
  • Commodities
  • Corporates
  • Contact Us

Copyright © 2022 RateCaptain - All rights reserved by RateCaptain.

?>