Officials of the International Monetary Fund say countries in sub-Saharan Africa averaged strong growth of more than five percent from 2004 to 2005, and they expect similar gains in 2006. Much of the growth is in oil-producing countries. But IMF officials say many other African countries are improving their economic policies.
The director of the IMF's African Department says the organization's key recommendations encourage countries to adopt policies that keep inflation low, improve the financial sector and decentralize government spending.
Abdoulaye Bio Tchane says that, with a few exceptions, national leaders seem to be listening. "We are clearly seeing some good responses from the authorities, obviously there are a few other cases where we face very important challenges. Clearly Zimbabwe is one of them. We've mentioned it in the report and you can see it in the inflation and GDP and growth rates," he said.
Zimbabwe's unemployment rate exceeds 70 percent, and its inflation rate of more than 900 percent is the highest in the world.
But Bio Tchane says Zimbabwe is the exception rather than the rule in sub-Saharan Africa, where sound economic policies have helped countries endure recent high oil prices. "African economies have pretty much weathered the high or increased oil prices. You can see it not only in the inflation rate but in the GDP growth rates. We haven't seen the type of shocks that countries faced in the 70s and 80s," he said.
Some oil-exporting countries have in fact benefited from the high prices, using the excess cash to pay off debt. On Friday, oil-rich Nigeria announced that it repaid the final four-point-five billion dollars it owed to Paris Club creditors.
Nigeria's finance minister, Ngozi Okonjo-Iweala, who is in Washington for talks with World Bank officials, said paying off the debt now allows Nigeria to spend money on other initiatives. "In fact, in Nigeria we're using resources from debt relief that we just got and putting that into education to improve the physical environment in which children learn making sure that teachers have the necessary equipment that children have books," he said.
IMF analysts say oil-exporting countries are also using their profits to build up foreign exchange reserves, buying short-term bonds such as U.S. Treasury Bills that can help shore up their economy in the future.
IMF officials say they are encouraging countries to be more open in how those funds are being used in the hope that greater government transparency will encourage more of the outside investment that is desperately needed to help lift millions out of poverty in sub-Saharan Africa.