(Updates with comment from release of the report)

By Olivia Kumwenda-Mtambo

JOHANNESBURG May 3 (Reuters) - Economic growth in sub-Saharan Africa is likely to slow this year to its weakest in nearly two decades, hurt by a slump in commodity prices, drought and the after-effects of the Ebola outbreak, the International Monetary Fund said on Tuesday.

In its African Economic Outlook, the Fund forecast growth would slip to 3 percent this year - the lowest rate since 1999 - from 3.4 percent in 2015.

Growth was expected to recover to 4 percent next year, helped by a slight recovery in commodity prices, and the IMF said it was still optimistic about the region's prospects in the longer term.

"However, to realise this potential, a substantial policy reset is critical in many cases," the IMF said.

Countries hurt by the drop in commodities prices needed to control their fiscal deficits, because the declines in revenue were expected to persist, the IMF said.

Louis Kasekende, the deputy governor of Uganda's central bank, agreed countries need to rebuild buffers, to help their economies deal with any external shocks.

"It would be preferable to fund higher public investment by making savings in recurrent budgets or by strengthening the domestic tax effort," Kasekende said when the IMF report was released in the Ugandan capital, Kampala.

Angola and Nigeria, both major oil exporters, were hardest hit by the commodities slump, the report said. So were Ghana, South Africa and Zambia.

Several southern and eastern African countries, among them Ethiopia, Malawi and Zimbabwe, were suffering from severe drought, the IMF said. And Guinea, Liberia, and Sierra Leone were only gradually recovering from the Ebola epidemic.

However, the report said, Ivory Coast, Kenya and Senegal would see growth of more than 5 percent, mostly "supported by ongoing infrastructure investment efforts and strong private consumption," the report said.

"The decline in oil prices has also helped these countries, though the windfall has tended to be smaller than expected, as exposure to the decline in other commodity prices and currency depreciations have partly offset the gains in many of them," it said. (Additional reporting by Duncan Miriri in Nairobi; Editing by Andrew Heavens, Larry King)