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Economic Resilience in Sub-Saharan Africa: Evidence from Composite Indicators

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Abstract

The objectives of this study are to measure and analyse the resilience of the Sub-Saharan Africa (SSA) economies between 2006 and 2015. Our methodology is that of the B2A algorithm and the graph theory. This study highlights two main results: firstly, results from 22 SSA countries show that very few show characteristics of a stable resilience, while most of these countries are still in a condition of uncontrolled vulnerability (or very fragile). Secondly, the South African economies show the highest resilience, though unstable, Central Africa and East Africa economies show a situation of controlled vulnerability, while the West African economies are the most fragile, though heterogeneous. Looking at country specificities, Cameroon, South Africa and Botswana are the only three countries in the sub-region to have maintained a stable situation of resilience. The policy implications of this study engage the SSA countries on the need to further enhance their macroeconomic policies especially policies that improve the contingent dimensions of resilience. These include improvement in political governance, fiscal sustainability and external balances. Policies which are growth driven are encouraged; this will lead to job creation, human development and, as a result, reduction in the social vulnerability. Moreover, natural resource exports revenues should be invested into other economic sectors to support long-term diversification and consequently resilience.

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Data Availability

The data that support the findings of this study are openly available in the following sites for the resilience sub-index:

WDI at http://databank.worldbank.org, 2018 edition

The Heritage foundation at http://www.heritage.org, 2017 index of economic freedom

Worldwide Governance Indicators at https://databank.worldbank.org, 2018 edition

The data for the vulnerability index is openly available from Feindouno, S. and Goujon, M. (2016) The Retrospective Economic Vulnerability index, 2015 update, Working Paper P147, FERDI, at http://www.ferdi.fr

Notes

  1. According to the European Policy Institutes Network (EPIN), A country is considered fragile if it has obtained an EPIN rating of 3.2 or less during the reporting period or if it has hosted a peacekee** or peace building of the United Nations or regional organisations, during the 3 years under review (the same results are obtained with an average of 5 years). Countries that were considered fragile in the 1990s, but not during the 2011–2013 period, recognised as “having become resilient” and those that were not considered fragile in either of these periods are classified as “stable”.

  2. The weakness of this indicator lies in the fact that some countries may however have high level of external debts not because of weak policies, but because of highly developed international financial activities. The use of other variables such as market flexible however corrects this weakness (Briguglio et al. 2009).

  3. A detail definition of these indicators is found in Kaufman (2010).

  4. The graph theory is an important structure of network of variables that bases economic and social phenomena (Naimzada et al. 2009; Bates et al. 2014). Graph theory helps identify the roots’ set of a studied phenomenon and structure the interdependence among these roots.

  5. See Louis Pablo de Horra (2018) Fondation for Economic education

  6. 20% of the population live below the poverty line, 22% of adults have HIV (World bank, 2018)

  7. Government, National. Why South Africa. Invest SA.

  8. Southhall (2016). How South Africa Works: And Must Do Better.

  9. The economic and business ranking

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Acknowledgements

The authors are grateful to Dr. Talla Fokam, Dr. Njamen Kengdo and Pr. Ongo Emmanuel and the anonymous referee for their useful comments towards improving the quality of this work.

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  1. University of Dschang, Dschang, Cameroon

    Ibrahim Ngouhouo & Tii Njivukuh Nchofoung

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  1. Ibrahim Ngouhouo
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Correspondence to Tii Njivukuh Nchofoung.

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Appendix

Appendix

Table 2 The average values of the indexes
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Table 3 Distribution of the average value of the indexes by region
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Table 4 Distribution of the average values of the indexes by currency
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Table 5 Distribution of the average values of the indexes by monetary and economic zones
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Table 6 Results’ table summary from the graph theorem
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Fig. 4
figure 4

The distribution of the 2013 values of the composite

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Table 7 Distribution of the contingent and control dimensions for the non-franc zone
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Table 8 Distribution of the contingent and control dimensions for the franc zone
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Table 9 Distribution of the contingent and control dimensions by regional grou**s
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Ngouhouo, I., Nchofoung, T.N. Economic Resilience in Sub-Saharan Africa: Evidence from Composite Indicators. J Knowl Econ 13, 70–91 (2022). https://doi.org/10.1007/s13132-020-00717-2

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