Going into 2019, 15 of the 21 sovereigns that Moody’s rates in the Sub-Saharan Africa region have a stable outlook, while six hold a negative outlook, according to the Sovereigns -Sub-Saharan Africa 2019 outlook by the investor’s service.
“Our negative outlook for sovereigns in Sub-Saharan Africa is driven by persistent credit challenges related to their ongoing fiscal and external vulnerabilities,” said Daniela Re Fraschini, assistant vice president – analyst and author of the report.
“That said, we expect credit pressures to ease relative to previous years, despite a more challenging external environment, as credit profiles display some resilience at their lower rating levels,” he added in a statement issued in Nairobi.
Moody’s expects the regions gradual economic recovery of 2018 to continue this year, with regional real GDP growth accelerating to 3.5% in 2019 from an estimated 2.8 percent in 2018.
According to the report, the region’s two largest economies – Nigeria and South Africa – will recover slowly but growth in these two countries will remain well below levels seen in the first half of the decade.
Moody’s projects that real GDP growth in South Africa will reach 1.3 percent in 2019, from an estimated 0.5 percent in 2018.
In Nigeria, growth will reach 2.3 percent in 2019 from an estimated 1.9 percent in 2018.