Burundi Strives to Emerge From Waves of Economic Shocks

By Mame Astou Diouf and Jocelyn Koussere

November 3, 2022

Burundi's economic growth expected to strengthen in 2022

Burundi’s economy has been challenged by the COVID-19 pandemic and Russia’s war in Ukraine. However, the economy is showing resilience, with economic growth expected to strengthen in 2022 to at least 3 percent, according to a recent assessment by the IMF.

Macroeconomic hurdles persist in Burundi, including deteriorating terms of trade and accelerating domestic inflation that is threatening already challenging living standards. The effects of the war in Ukraine have driven food and fuel prices up, with overall inflation at 20.9 percent at end-September 2022, from 10.5 percent at end-August 2021.

Before the war in Ukraine, the economic outlook of Burundi had been promising, with growth projected to a robust 4.7 percent in the medium term, supported by several positive effects including the impact of reforms, projects in the agricultural and mining sectors, and financial deepening. Economic growth prospects remain strong, also supported by the country’s progressive reengagement with the IMF and the international community more generally. The lifting of US and EU sanctions—a legacy of Burundi’s 2015 political and security crisis—is emblematic of this reengagement. This year, the IMF Executive Board completed Burundi’s first Article IV consultation since 2014.

With technical assistance from the IMF, the government is taking steps to reform its foreign exchange market, which if implemented, would help replenish the country’s international reserves. 

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Mame Astou Diouf is a Deputy Division Chief in the African Department.
Jocelyn Koussere is an economist in the African Department.