Economic growth in West Africa is projected to rise to 3.8 percent in 2018 and 3.9 percent in 2019 on the back of strong household consumption and price recovery, according to the African Development Bank Group (AfDB) in its latest African Economic Outlook released Tuesday.
The Outlook with five regional reports indicates that there was a decline in regional economies with West Africa exhibiting progress in ‘contrasting panorama’.
The AfDB, however, 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,” Marie-Laure Akin-Olugbade, deputy director general of the African Development Bank for West Africa, said.
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The West Africa regional report noted that after several good years, economic growth in West Africa stagnated at 0.5 percent in 2016 following decline in the price of raw materials and the unimpressive performance of Nigeria, which alone accounts for about 70 percent of the sub region’s GDP.
However, economic growth in the region rebounded to 2.5 percent in 2017 and is projected to rise to 3.8 percent in 2018 and 3.9 percent in 2019 with household consumption and the relative price recovery of certain materials contributing to performance.
The regional economic reports were released simultaneously in Tunis (North Africa), Abidjan (West and Central Africa), Nairobi (Eastern Africa) and Pretoria (Southern Africa).
“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,” said Celestin Monga, chief economist and vice president of the AfDB’s economic governance and knowledge management.
“The integration of specific reports for each region reflect the importance the Bank’s focus on the regional dimensions of development and inclusive growth in Africa,” said Mohamed El Azizi, director general of the North Africa Region.
Growth in North Africa is expected to reach 5 percent and 4.6 percent respectively in 2018 and 2019.
“North Africa ended 2017 with the growth of 4.9 percent of real GDP, up from 3.3 percent recorded in 2016. The region’s economic performance is above a 3.6 percent 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,” the North African report highlighted.
The AfDB said East Africa was the best economic performer on the continent. With 13 countries, the region recorded the continent’s best economic performance with a GDP growth rate of 5.9 percent 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 percent.
It said 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 percent in 2018 and 6.2 percent in 2019,” the report noted.
For Southern Africa, economic growth is expected to improve to 2 percent in 2018 and 2.4 percent in 2019.
“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,” Josephine Ngure, deputy director general of the Bank for Southern Africa, said.
The outlook for 2018 and 2019 for Central Africa 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.
The African Economic Outlook is a flagship publication of the Bank, which provides an overview of the economies of the 54 African countries. The general launch took place on January 17 in Abidjan, Côte d’Ivoire. A second presentation ceremony was held in Addis Ababa on 26 January, on the sidelines of the Thirtieth Summit of the African Union.