African countries see economic growth boost with lower budget deficits
The study looked at how budget deficits and current account deficits affect economic growth in African countries. They used data from 1988 to 2018 and found that in 16 out of 27 countries, there is no direct link between budget deficits and current account deficits. They also discovered that a budget deficit of less than 0.152% can actually help economic growth. However, high government debt and current account deficits have a negative impact on GDP per capita. On the other hand, factors like investment spending, broad money, and political stability can boost economic growth.