Report: Liberia, Others Bolster Reforms & Central Bank Independence
The latest Country Policy and Institutional Assessment (CPIA) report for Sub-Saharan Africa (SSA) has revealed that the region has weathered the challenges of 2023 relatively well, thanks to credible economic and social policy reforms implemented by governments and central banks.
The report highlights that countries in the region have started to shift their focus from weathering global shocks to building credibility, capacity, and transparency. One key indicator of this progress is the strong performance of SSA countries across multiple measures of Central Bank independence, which improves their ability to reduce inflation and enhances investors’ perception of risks.
However, the report also notes that countries were held back by low transparency and inadequate judicial oversight. Moreover, governments facing budget constraints linked to high debt service costs will need to work harder to attract private sector investments to stimulate economic growth.
“The CPIA review offers a chance to identify areas of relative weakness and engage in a dialogue around policy reforms that can produce better development outcomes,” said Andrew Dabalen, World Bank Chief Economist for Africa.
The report highlights the need to attract and sustain greater private sector investments, as the public sector’s ability to drive investment growth is limited by high interest rates and public debt. “Private sector investments will need to pick up after years of investment growth coming from the public sector,” said Nicholas Woolley, the CPIA report’s main author.
The CPIA scores could provide guidance to international investors and businesses on the quality of institutions and the efficacy of recent reforms in the region, which sometimes prevents interested partners from starting new activities in SSA.
