Africa: 'Economic Outlook for Africa Remains Challenging'

28 November 2019

The economic outlook for Africa remains challenging with growth expected to pick up to close the year and going into 2020, the Economic Commission for Africa Sub Regional Office for West Africa has said.

Dr Nadia S. Ouedraogo, Economic Affairs Officer of the Commission who made this known said the region faced difficulty in embarking on robust and sustained growth trajectory with rates insufficient to absorb a fast-growing labour force.

She was speaking at a workshop on economic monitoring, short-term economic forecasting 2019-2020 for English-speaking Economic Community of West African States (ECOWAS) including; Ghana, The Gambia, Liberia, Nigeria, Sierra Leone and Cape Verde in Accra.

The workshop was organised by the Economic Commission for Africa Sub Regional Office for West Africa (ECA SRO-WA) under the auspices of the Economic and Statistical Observatory for Sub-Saharan Africa (AFRISTAT).

The four-day workshop was to share experiences on recent economic developments and short-term macroeconomic forecasting methods used in English speaking member states.

The reason for the fragile growth rate was given as lower-than-expected commodity prices and escalation of trade tension on the external threatening projections, which impact many commodity exporters of Africa.

Dr Ouedraogo said weather-related shocks, political uncertainties and security concerns in addition to the recent upsurge in external sovereign bond issuances, raise debt sustainability concerns in several economies on the continent.

Developing countries are projected to grow from 4.1 percent to 4.5 percent, while the global economy would grow at 3.0 percent and expected to recover to 3.4 percent in 2020.

He said inflation eased overall in Africa in 2019 and would continue to do so in 2020, but remained relatively high in North and West Africa where inflation prospects were improving as a result of strong agricultural and food production and stable exchange rates.

"ECOWAS Zone will maintain low level inflationary pressure, while double digits inflation rate are still recorded in Liberia, Sierra Leone and Nigeria."

He called for strengthening of resilience of sub-regional economy on commodity pricing shocks through the implementation of economic diversified policies.

Dr Ouedraogo said member states must continue to mobilise tax revenue, rationalise spending and consolidate public finances to reduce budget deficits and better control debts.

Mr Jean Serge Edi, Principal Economic expert, AFRISTAT, called on the need for policymakers, firms and households to have up-to-date analysis of economic conditions supported by the identification of the main drivers of the various fluctuations and short-term economic forecasts.

He said there must be a better way to monitor the high data frequency indicators including consumer price index (CPI), quarterly GDP and the production of indexes that could quickly inform on the current economic conditions.

He named Ghana, Nigeria, Cape Verde, Senegal, Cote d'Ivoire and Burkina Faso for constantly producing and disseminating quarterly GDP and entreated the rest to emulate them.

Dr Simeon Koffi, Director, Department of Macroeconomics Policy and Economic Research, ECOWAS Commission, asked that assumptions must be incorporated into scenarios and share hypothesis to assist in understanding figures meaningfully.

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