May 29, 2012
IMF says Last Decade Best Ever for Sub-Saharan Africa
by Laura Burke
The International Monetary Fund
says that economically speaking, the past 10 to 15 years have been the best ever for sub-Saharan Africa - which has been largely insulated from the global financial crisis of 2008-2009. Some countries are experiencing faster economic growth than many robust economies in Asia did 20 years ago. But the new wealth is not always being shared with the poor.
Sub-Saharan Africa has enjoyed a long period of strong economic growth. The IMF says it has been spurred by mineral wealth and the growth of the telecommunications, tourism and construction industries.
Roger Nord, deputy director of the Africa department of the IMF, says when the world was hit by the global financial crisis in 2008, Africa was resilient. “We saw that 2008-2009 growth went down slightly but by no means as much as it did in the rest of the world, which was going through a sharp recession," he recalled. "And we’ve seen a rapid rebound. We now have 5 percent growth in 2011. 2012, our projection is 5.5. And about the same level in 2013.”
African economies have long been vulnerable to fluctuations in European and American markets. Nord said this is changing.
Trade has trended away from traditional partners like the United States and Europe, toward emerging markets like China, India and Brazil. The IMF says this trade with new markets has helped insulate Africa from the economic downturn in Europe and the U.S, as have sound economic policies.
Nord notes the growth Africa is experiencing compares to the growth much of Asia began experiencing 20 or 30 years ago. He says Rwanda and Mozambique have even had faster “take-offs” than India, Vietnam, Korea or Thailand did.
Yet not all countries on the continent are thriving. Countries in conflict, such as the Central African Republic and Guinea-Bissau, have had little growth.
And while the poor have benefited overall, some countries are doing better than others at sharing the wealth coming from minerals and oil.
For the poor to benefit, Nord says policies have to focus on the sector where the largest proportion of the poor work in sub-Saharan Africa: agriculture. “So you have to make sure that you don’t have only growth in your natural resources, in oil and minerals. You also have to make sure that the rural population benefits," he stated. "And that way you can get a good distribution of growth.”
But Nord says for Africa to emerge out of poverty, this growth has to be maintained for decades. “It has to last if Africa wants to come out of poverty. We’re optimistic that it's possible," he said. "We’ve seen countries like Tanzania, Uganda, Mozambique, to name just a few, that have been maintaining these growth rates now for 15, sometimes 20 years. And that’s going to be needed. So the challenge, the challenge for Africa and for the world, is to make sure that they can can maintain this.”
Nord notes that requires not only good economic policies but also stable political and social conditions, and the absence of conflict.