AfDB Outlook on Africa sees 5 priorities Africa must focus to face future competitively
The Africa Development Bank (AfDB) Outlook Report for Africa has restimated that its High 5 priorities; consisting of Light up and Power Africa, Feed Africa, Industrialise Africa, Integrate Africa, and Improve the quality of life for the people of Africa – would spearhead Africa’s economic diversification and growth in broad-based economic opportunities that will shield the continent from future commodity shocks and enhance their resilience.
Co-presenter and acting vice-president for finance, Hassatou N’Sele
“Growth prospects would further be boosted by expected increases in commodity prices, strong domestic demand, better macroeconomic governance and an improved business environment.”
The report also cited rising debt, structural weaknesses, power outages, climate change, conflict, political instability and terrorism among some of the downside risks which should not be ignored.
The report said Foreign Direct Investment increased slightly reaching $56.5 billion in tune with growing urbanisation and cities growing with consumer markets increasingly targeted by foreign investors.
Official development assistance, which remains the most important source of public finance, declined by 1.7%.
Remittances mainly by the African Diaspora represent a key source of capital for African countries totaling $64.6 billion in 2016, the report says.
However, the facts on the ground suggest that these resources are insufficient to fully meet the continent’s development challenges.
According to the report, while natural resources and primary commodities remain major growth drivers, their importance has declined, while domestic factors including consumption demand now play a greater role.
Just as East Africa emerged the best sub-regional performer with a 5.3% real GDP growth average driven by strong performance in Ethiopia, Tanzania and Djibouti, North Africa followed with an average 3.3% growth driven by recoveries in Egypt (4.3%) and Algeria (3.5%), amidst persistent political uncertainties.
Besides, Southern Africa recorded a 1.1% average due to the poor performance of South Africa and Angola, two major commodity exporters in the sub-region hit by drought, persistent power outages and adverse terms-of-trade shocks, while Madagascar and Mozambique were rare bright spots, posted growth rates above 4%.
Central Africa followed with a 0.8% average due to low commodity prices while some countries like Cameroon proved resilient. The Central African Republic and São Tomé and Príncipe improved their economic performances, the reported noted.
At the bottom was West Africa, averaging a 0.4% growth rate despite good performances by Côte d’Ivoire and Senegal, which were cancelled out by recession and socio-political factors that bogged down the economy to 1.5% growth.
The report also noted that Nigeria and South Africa account for the largest share of Africa’s GDP with 29% and 19%, respectively.
