AfDB releases regional economic outlook for Africa

The African Development Bank (AfDB) has released a summary of its economic outlook for all regions of Africa.
The summary follows publication of an expanded version of its African Economic Outlook, with five regional reports. The regional economic studies were released in Tunis (North Africa), Abidjan (West and Central Africa), Nairobi (Eastern Africa) and Pretoria (Southern Africa).

These details were contained in a statement by the AfDB obtained by Ripples Nigeria.

Commenting on the development, Chief Economist and Vice President of the Bank’s Economic Governance and Knowledge Management, Celestin Monga, said “by offering regional approaches for the first time, we want to leverage the Bank’s expertise and give more depth of analysis and relevance to this publication.”

Also commenting, Director General of the North Africa Region, Mohamed El Azizi, said “the integration of specific reports for each region reflects the importance the Bank’s focus on the regional dimensions of development and inclusive growth in Africa”.

Summary of the Report:
North Africa: A Positive Outlook For 2018 And 2019
North Africa ended 2017 with growth of 4.9% of real GDP, up from 3.3% recorded in 2016. The region’s economic performance is above a 3.6% average for the continent, thanks to higher than expected oil production in Libya and the performance of Morocco, which saw growth rise from 1.2% in 2016 to 4.1% in 2017, on account of increased agricultural productivity. Egypt’s macroeconomic and structural reforms led to a 4% growth in 2017. Overall, growth in the North Africa region was fueled by new high value-added sectors such as electronics and mechanics, as well as private and public consumption. The region’s outlook remains positive for 2018 and 2019, on account of structural reforms. Growth in North Africa is expected to reach 5% and 4.6% respectively in 2018 and 2019.

East Africa: The Best Economic Performance Of The Continent
East Africa, with thirteen countries, recorded the continent’s best economic performance with a GDP growth rate of 5.9% in 2017 −a rate much higher than the growth recorded by the other regions of the continent, and above the continental average of 3.6%. The good performance of the East African sub region is stimulated by six countries: Ethiopia, Tanzania, Djibouti, Rwanda, Seychelles and Kenya. The outlook remains positive for 2018 and 2019, with growth expected to continue, reaching 5.9% in 2018 and 6.2% in 2019.

Southern Africa: Economic Recovery Started, But Contrasting Growth

Estimated at 1.6% on average in 2017, real GDP growth in Southern Africa is expected to improve to 2% in 2018 and 2.4% in 2019. Deputy Director General of the Bank for Southern Africa, Josephine Ngure said: “The Southern Africa region has made considerable progress in the fight against poverty and improvements in the quality of life of its inhabitants, through the implementation of policies targeting the acceleration of industrialization and the promotion of growth and job creation.”

Read also: Inflation rate drops for 13th consecutive time to 14.33% in February –NBS

However, economic forecasts remain cautious, especially given the very different growth patterns of the region’s economies. The economic “locomotive” of the region, South Africa, shows signs of slow growth, and possibly declining growth, while low-income countries and the economies in transition, such as Madagascar and Mozambique, recorded more important growth.

“High fiscal deficits and rising public debt pose challenges to macroeconomic stability in several southern African countries. Governments should put in place measures to improve the mobilization of domestic resources and funds from the private sector to ensure adequate levels of development spending, stimulate growth and create jobs, especially for young people, “said Stefan Muller, Bank’s Senior Economist for Southern Africa.

West Africa: Progress In A Contrasting Panorama
After several good years, economic growth in West Africa stagnated at 0.5% in 2016. The decline in the price of raw materials and the unimpressive performance of Nigeria, which alone accounts for about 70% of the sub region’s GDP, were some of the key factors identified as responsible for stagnation. Economic growth in West Africa rebounded to 2.5% in 2017 and is projected to rise to 3.8% in 2018 and 3.9% in 2019. Household consumption and the relative price recovery of certain materials are expected to contribute to this performance.

Marie-Laure Akin-Olugbade, Deputy Director General of the African Development Bank for West Africa, identified job creation, especially for young people as the big challenge for the sub-region.

“The 2018 Regional Economic Outlook for West Africa presents a comprehensive analysis of the economy and the labor market of 15 countries, focusing on macroeconomic stability, employment and poverty of the population living in West Africa. Let us not forget that some of the countries in this sub-region are facing enormous security challenges, “she said.

Central Africa: Better Prospects After A Modest Performance
The Central African region recorded 0.9% real GDP in 2017, the lowest growth rate of the continent, although it represents a relative improvement over growth of 0.1% in 2016. This sub regional performance masks many disparities between countries: relatively good growth for Cameroon and the Central African Republic, and very low growth for Equatorial Guinea and Congo. The economic difficulties in Central Africa are largely due to lower raw material prices, which some countries in the region are heavily dependent on, as well as recurring security threats in others.

The outlook for 2018 and 2019 is more encouraging, fueled by rising world prices for raw materials and domestic demand. According to the Bank’s projections, real GDP growth in Central Africa is expected to reach 2.4 percent in 2018 and 3 percent in the following year. Other enabling factors include sound macroeconomic management and a more favorable institutional environment.

“With improvements in the economic situations of Congo and Equatorial Guinea, the economic performance of the sub-region is expected to improve in 2018 and 2019. It would be good to include this improvement over time through the diversification of economies of the sub region,” said Racine Kane, Deputy Director General of the African Development Bank for Central Africa.

 

RipplesNigeria… without borders, without fears

Click here to join the Ripples Nigeria WhatsApp group for latest updates.

Join the conversation

Opinions

Support Ripples Nigeria, hold up solutions journalism

Balanced, fearless journalism driven by data comes at huge financial costs.

As a media platform, we hold leadership accountable and will not trade the right to press freedom and free speech for a piece of cake.

If you like what we do, and are ready to uphold solutions journalism, kindly donate to the Ripples Nigeria cause.

Your support would help to ensure that citizens and institutions continue to have free access to credible and reliable information for societal development.

Donate Now