African economies turn to IMF as Iran war, aid cuts deepen fiscal strain

The economic aftershocks of the ongoing conflict in West Asia and a sharp decline in foreign aid are driving a growing number of African countries to seek financial assistance from the International Monetary Fund, the Fund said on Thursday.

The IMF said 27 of 45 countries in sub-Saharan Africa are now under IMF-supported programmes, highlighting the scale of fiscal stress across the region. Governments are increasingly requesting fresh loans or expansions of existing arrangements as external pressures mount.

“We are the world’s crisis fighter,” IMF Africa director Abebe Selassie told Reuters, noting that several countries were seeking quicker access to funds through accelerated disbursements or new lending programmes.

The Fund this week cut its 2026 growth forecast for sub-Saharan Africa to 4.3 per cent, warning that energy-importing economies without strong resource buffers are particularly vulnerable. The conflict in West Asia has pushed up fuel and fertiliser costs while disrupting trade, tourism and remittance flows—key lifelines for many African economies.

More from Business

The strain has been compounded by a steep fall in bilateral aid. Data from the Organisation for Economic Co-operation and Development showed that aid to some of the poorest countries dropped by more than a fifth in 2025, largely due to donor policy shifts rather than conditions within recipient nations.

Countries including Gabon have formally requested IMF loans, while Chad and the Central African Republic are undergoing programme reviews. Others such as Zimbabwe and Mozambique are engaging with the Fund to stabilise finances and unlock broader debt restructuring talks.

“Just as the region is beginning to recover… then you have this new shock,” Selassie said, describing the West Asia conflict as dampening what had been a strong post-pandemic rebound.

With limited fiscal space, many governments are unable to cushion the blow, particularly as cuts to humanitarian aid disproportionately affect vulnerable populations. Inflation across the region is projected to rise to 5 per cent by end-2026.