News / Africa

Africa Sees Strong Economic Growth

World Bank forecasts strong growth for sub-Saharan Africa.  (World Bank)World Bank forecasts strong growth for sub-Saharan Africa. (World Bank)
x
World Bank forecasts strong growth for sub-Saharan Africa.  (World Bank)
World Bank forecasts strong growth for sub-Saharan Africa. (World Bank)

Multimedia

Audio
  • Listen to De Capua report on World Bank forecast for Africa

Joe DeCapua
The World Bank says while the global economic recovery remains slow, sub-Saharan African countries continue to grow at a strong pace. The bank has released its latest economic forecast for the region.


Four years after the start of the economic crisis, the World Bank describes the global recovery as “tepid,” especially in the euro zone. Sub-Saharan Africa, on the other hand, has some of the fastest growing economies in the world, thanks to domestic demand and commodity prices that remain high. That’s according to the latest edition of the World Bank report called Africa’s Pulse.

“The report finds that Africa has been growing at a sustained, robust pace in 2012 and the region grew by 4.7 percent, which is double the rate of growth of the global economy. And this growth is impressive because it is in spite of the tepid and weak recovery that the global economy was experiencing in 2012,” said Punam Chuhan-Pole, lead economist for the Africa region, who is the co-author.


She said that if you exclude South Africa, which was hit by the recession, the sub-Saharan economy actually grew by 5.8 percent. Some individual countries had an even higher growth rate.

Several countries, such as Ethiopia, Rwanda, Ghana have managed to grow at 7 percent or more in each of the past three years. That means 2010, ’11 and ’12. And several other countries have also been growing at a strong pace, for example, Nigeria, Zambia, Tanzania, the Democratic Republic of Congo.

Despite the slow global recovery, Foreign Direct Investment, or FDI, actually increased in sub-Saharan Africa by 5.5 percent to $37.7 billion in 2012. In fact, it continued to grow in Africa while falling elsewhere in the developing world.

Chuhan-Pole also said domestic spending rose, as did government spending in infrastructure.

“So with government capital spending increasing to meet some of the large gaps in power and transportation, energy, Africa’s investment has been rising. Also, private consumption has been supported by declining inflation as well as lower interest rates and also easier access to credit. In addition, agricultural income in several countries increased. So all of this has helped to keep private consumption rising,” she said.

The World Bank forecast said that sub-Saharan Africa’s economic growth is expected to average over 5 percent between 2013 and 2015. However, there are risks, such as the weak global recovery.

Chuhan-Pole also said growth has been good for poverty reduction, just not good enough.

“What to we mean by that? If you look the period since 1996, per capita GDP has improved at a fairly brisk pace of 2.4 percent per annum. However, there’s variation across countries. We find that resource rich countries grew at over twice the rate as resource poor countries,” she said.

The World Bank’s outgoing Chief Economist for Africa, Shanta Devarajan, says harnessing economic growth to accelerate poverty reduction is the biggest issue facing policymakers. That’s especially true, he says, with more countries discovering they’re rich in resources. Almost 50 percent of the region’s population lives on $1.25 a day.

“What we have to realize is that resource income or resource revenues are not necessarily the fastest way to reduce poverty for the very simple reason that growth in resource rich countries occurs in the extractive sector, but the poor earn their income from agriculture. Seventy percent of the poor are actually working in agriculture,” he said.

He said there are several ways to ensure resource wealth benefits the population and not just the oil, gas or mineral companies. First, he says, contracts must be as transparent as possible, so countries get their fair share. The next step is to spend that money wisely, for example, on infrastructure, like electricity, along with health and education. He says safety nets and cash transfers should be available to shield the population from poverty and global economic shocks.

Devarajan said that agriculture is another good place to invest.


‘There’s an estimate that worldwide, something like, one percent growth in agriculture is four times as powerful in reducing poverty as non-agricultural growth.”

He said Africa has the potential to be – what he calls – the workbench of the world, as well as the source of savings, investment and growth. Much of that has to do with the continent’s demographics, which are bucking the world trend.

“Africa is going to be the youngest continent in the world. We have a youth bulge and the number of 15 to 65 year olds is going to be the highest in Africa in about 20 years. And that means that we have an opportunity because the number of working people relative to the number of dependents, if you like, very young and very old, is going to be increasing in Africa, whereas in the rest of the world, frankly, it’s going to be decreasing,” he said.

The World Bank’s Africa’s Pulse report also said good progress has been made on a few of the Millennium Development Goals. But the progress across the region has been uneven and, overall, the region lags in achieving development goals.

You May Like

Report: $60 Billion Leaves Africa Illegally Each Year

Report by joint UN and African Union panel says African countries need to take concrete measures to stop illegal money flow from continent each year More

Video Spy Murder Probe Likely to Further Strain British-Russian Relations

Some analysts say Russian Tu-95 bombers were flying near British airspace to warn Britain about an inquest into a murdered Russian spy More

Mugabe Defends Image Amid Controversy at Close of AU Summit

He rejects concerns about how the West might perceive his leadership, saying he's focused on African development More

Featured Videos

Your JavaScript is turned off or you have an old version of Adobe's Flash Player. Get the latest Flash player.
Spy Murder Probe Likely to Further Strain British-Russian Relationsi
X
Henry Ridgwell
January 31, 2015 10:50 PM
Relations between Russia and the West are set to become even more strained amid an inquiry in London into the murder of a former Russian spy. Lawyers at the inquiry accuse Russian President Vladimir Putin of directing a "mafia state." Meanwhile, Royal Air Force fighters intercepted Russian bombers close to British airspace this week, prompting authorities to summon Moscow’s ambassador. Henry Ridgwell reports.
Video

Video Spy Murder Probe Likely to Further Strain British-Russian Relations

Relations between Russia and the West are set to become even more strained amid an inquiry in London into the murder of a former Russian spy. Lawyers at the inquiry accuse Russian President Vladimir Putin of directing a "mafia state." Meanwhile, Royal Air Force fighters intercepted Russian bombers close to British airspace this week, prompting authorities to summon Moscow’s ambassador. Henry Ridgwell reports.
Video

Video Ukrainian Neighborhood Divided Over Conflict

People in eastern Ukraine’s Donetsk and Luhansk districts find themselves squarely in the path of advancing Russian-backed rebels, who want to take back the territory they held at the beginning of the conflict last year. Many local residents are afraid, but others would welcome the change, even when a rebel shell lands in their neighborhood. From the Luhansk district, 15 kilometers from where the Ukrainian government marks the front line, VOA’s Al Pessin reports.
Video

Video Threat of Creeping Lava Has Hawaiians on Edge

Residents of the small town of Pahoa on the Big Island of Hawaii face an advancing threat from the Kilauea volcano. Local residents are keeping a watchful eye on creeping lava. Mike O’Sullivan reports.
Video

Video Jefferson's Library Continues to Impress, 200 Years Later

Two hundred years after the U.S. Congress purchased a huge collection of books belonging to former President Thomas Jefferson, it remains one of America’s greatest literal treasures and has become the centerpiece of Washington’s Library of Congress. VOA’s Deborah Block reports.
Video

Video Egypt's Suez Canal Dreams Tempered by Continued Unrest

Egypt plans to expand the Suez Canal, raising hopes that the end of its economic crisis may be in sight. But some analysts say they expect the project may cost too much and take too long to make life better for everyday Egyptians. VOA's Heather Murdock reports.
Video

Video Pro-Kremlin Youth Group Creatively Promotes 'Patriotic' Propaganda

As Russia's President Vladimir Putin faces international pressure over Ukraine and a failing economy, unofficial domestic groups are rallying to his support. One such youth organization, CET, or Network, uses creative multimedia to appeal to Russia's urban youth with patriotic propaganda. VOA's Daniel Schearf reports.
Video

Video Filmmakers Produce Hand-Painted Documentary on Van Gogh

The troubled life of the famous 19th century Dutch painter Vincent van Gogh has been told through many books and films, but never in the way a group of filmmakers now intends to do. "Loving Vincent " will be the first ever feature-length film made of animated hand-painted images, done in the style of the late artist. VOA’s George Putic reports.
Video

Video Issues or Ethnicity? Question Divides Nigeria

As Nigeria goes to the polls next month, many expect the two top presidential contenders to gain much of their support from constituencies organized along ethnic or religious lines. But are faith and regional blocs really what political power in Nigeria is about? Chris Stein reports.
Video

Video Rock-Consuming Organisms Alter Views of Life Processes

Scientists thought they knew much about how life works, until a discovery more than two decades ago challenged conventional beliefs. Scientists found that there are organisms that breathe rocks. And it is only recently that the scientific community is accepting that there are organisms that could get energy out of rocks. Correspondent Elizabeth Lee reports.
Video

Video Paris Attacks Highlight Global Weapons Black Market

As law enforcement officials piece together how the Paris and Belgian terror cells carried out their recent attacks, questions are being asked about how they obtained military grade assault weapons - which are illegal in the European Union. As VOA's Jeff Swicord reports, experts say there is a very active worldwide black market for these weapons, and criminals and terrorists are buying.
Video

Video Activists Accuse China of Targeting Religious Freedom

The U.S.-based Chinese religious rights group ChinaAid says 2014 was the worst year for religious freedom in China since the end of the Cultural Revolution. As Ye Fan reports, activists say Beijing has been tightening religious controls ever since Chinese leader Xi Jinping came to office. Hu Wei narrates.
Video

Video Theologians Cast Doubt on Morality of Drone Strikes

In 2006, stirred by photos of U.S. soldiers mistreating Iraqi prisoners, a group of American faith leaders and academics launched the National Religious Campaign Against Torture. It played an important role in getting Congress to investigate, and the president to ban, torture. VOA's Jerome Socolovsky reports.

Circumventing Censorship

An Internet Primer for Healthy Web Habits

As surveillance and censoring technologies advance, so, too, do new tools for your computer or mobile device that help protect your privacy and break through Internet censorship.
More

All About America

AppleAndroid