The Economic growth in Sub-Saharan Africa (SSA) continues to rise from 4.7 per cent in 2013 to a forecast of 5.2 per cent in 2014.
“This performance is boosted by rising investment in natural resources and infrastructure, and strong household spending, according to the World Bank’s new Africa Pulse, a twice-yearly analysis of the issues shaping Africa’s economic prospects report made available to the Ghana News Agency in Accra on Monday.
According to the report, growth was notably buoyant in resource-rich countries, including Sierra Leone and the Democratic Republic of Congo.
It remained steady in Cote d’Ivoire, while rebounding in Mali, supported by improved political stability and security….“Non-resource-rich countries, particularly Ethiopia and Rwanda, also experienced solid economic growth in 2013,” the report stated.
According to the report, capital flows to Sub-Saharan Africa continued to rise, reaching an estimated 5.3 per cent of regional GDP in 2013, significantly above the developing country average of 3.9 per cent.
It said net foreign direct investment (FDI) inflows to the region grew 16 per cent to a near-record $43 billion in 2013, boosted by new oil and gas discoveries in many countries including Angola, Mozambique, and Tanzania.
With lower international food and fuel prices, and prudent monetary policy, inflation slowed in the region, growing at an annual rate of 6.3 per cent in 2013, compared with 10.7 per cent a year ago.
According to the report, some countries, such as Ghana and Malawi, had seen an uptick in inflation because of depreciating currencies. Remittances to the region grew by 6.2 per cent to $32 billion in 2013, exceeding the record of $30 billion reached in 2011.
These inflows, combined with lower food prices, boosted household real incomes and spending.
The report revealed that Tourism also grew notably in 2013, helping to support the balance of payments of many countries in the region.
Quoting the UN World Tourism Organization, the report said international tourist arrivals in Sub-Saharan Africa grew by 5.2 per cent in 2013, reaching a record 36 million, up from 34 million in 2012, contributing to government revenue, private incomes, and jobs.
High-quality university programmes in Africa, particularly in areas such as the applied sciences, technology, and engineering, could dramatically increase the regions competitiveness, productivity and growth, says Makhtar Diop, the World Bank Groups Vice President for Africa.
It said strategic reforms are needed to expand young people’s access to science-based education at both the country and the regional level, and to ensure that they graduate with cutting-edge knowledge that is relevant and meets the needs of private sector employers.
The WB Vice President further notes that a number of African countries are now routinely among the world’s fastest-growing countries as a result of sound macroeconomic reforms in recent years and the fact that the rest of the world has steadily updated its reality of the continent as a high opportunity region for trade, investment, business, science and technology, and tourism.
The report said poor physical infrastructure will, however, continue to limit the region’s growth potential. Significantly more infrastructure spending is needed in most countries in the region if they are to achieve a lasting transformation of their economies.
Africa Pulse says that the regions infrastructure deficit is most acute in energy and roads and that across Africa, unreliable and expensive electricity supply and poor road conditions continue to impose high costs on business and intra-regional trade.