Constance Ikokwu
14 May 2008
Washington, DC — A report entitled "2007/2008 African Economic Outlook" jointly published by the African Development Bank (AfDB), the Organisation for Economic Co-operation and Development (OECD) Centre and the United Nations Economic Commission for Africa (UNECA) has predicted acceleration in Nigeria's economy.
The prediction is predicated on the current high oil prices, but the report warned that emerging inflationary pressures from the recent rise in food prices pose a threat to African economies.
The report, which was launched in Maputo, Mozambique, last Sunday, says emerging inflationary pressures will lead to "unwinding progress made by many countries in attaining the Millennium Development Goals (MDGs), especially the likelihood of pushing millions back into poverty, if the current high food prices persist".
AfDB Chief Economist, Louis Kasekendu said: "The continent still needs to accelerate and sustain growth to the rate of 7 to 8 per cent to be able to achieve MDGs of halving the proportion of people living in extreme poverty by 2015."
According to the report, Africa's economic performance as a whole is "becoming more broad-based with more countries expected to achieve rate of GDP growth above 5.0 per cent". Real GDP growth of 5.7 per cent was well above the long term trend for the fifth consecutive year.
It states that, "The rate of GDP growth is expected to strengthen to about 6.0 per cent in 2008 and be maintained at that level in 2009."
Economic growth in West African countries is projected to accelerate from 3.5 per cent in 2007 to 5.6 per cent in 2008 and will remain high at 5.7 in 2009, says the report, with Nigeria's growth expected to accelerate.
It is expected that expansion in agricultural production in several countries in West Africa will sustain high growth, it states, adding that post-conflict spending on infrastructure and the recovery of agricultural production will boost growth in Liberia and Sierra Leone. Growth in Ghana and Cape Verde will remain strong.
However, growth in the West African Economic and Monetary Union (WAEMU) countries will continue to be affected by slow recovery from the crisis in Ivory Coast, the report notes.
It says that Africa's strong economic performance has been supported by external demand for oil and non-oil minerals. The continuation of sound macroeconomic policies has increased business confidence in the continent leading to a rise in private investment.
It projects the average growth for Southern Africa at 5.2 per cent in 2008 and 2009 down from 7 per cent in 2007.
It says Botswana is expected to grow slightly above 4.0 per cent and Malawi by about 5.0 per cent in 2008 and 2009.
Growth in South Africa, the report states, will slow to 4.0 per cent in both years owing to insufficient electricity production growth.
Its projection for growth for Angola, will be from 19.8 per cent in 2007 to 11.5 per cent in 2008 and to 5.0 in 2009 because of oil production slow-down, while Madagascar and Mauritius will remain strong.
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