World Bank raises Africa’s growth forecast

Sub-Saharan Africa’s economic growth should increase to 5.3 per cent next year, with strong private and public investment underpinning the region’s robust performance, the World Bank said on Monday.

The bank lifted its forecast for 2014 from the 5.1 per cent projected earlier this year. The region was expected to grow 5.5 per cent in 2015, up from a previous forecast of 5.2 per cent, it said in its bi-annual ‘Africa’s Pulse’ report.

Growth for this year is forecast at 4.9 per cent, higher than last year’s 4.2 per cent. The figure is more than double the bank’s 2.3 per cent estimate for global growth in 2013, underscoring the attractiveness of the continent for investors.

Economic growth in Sub-Saharan Africa remains strong with a growth forecast of 4.9 per cent in 2013.

Almost a third of countries in the region are growing at six per cent and more, and African countries are now routinely among the fastest-growing countries in the world, according to the World Bank’s new Africa’s Pulse, a twice-yearly analysis of the issues shaping Africa’s economic prospects.

Buoyed by rising private investment in the region and remittances now worth $33bn a year supporting household incomes, Gross Domestic Product growth in Africa will continue to rise and pick up to 5.3 per cent in 2014 and 5.5 per cent in 2015.

Strong government investments and higher production in the mineral resources, agriculture and service sectors are supporting the bulk of the economic growth.

 As Africa’s growth rates continue to surge with the region becoming increasingly a magnet for investment and tourism, Africa’s Pulse notes that poverty and inequality remain “unacceptably high and the pace of reduction unacceptably slow.”

Almost one out of every two Africans lives in extreme poverty today. Optimistically, that rate will fall to between 16 per cent and 30 per cent by 2030.

The report suggests that most of the world’s poor people, by 2030, will live in Africa.

A statement by the World Bank quoted its Vice-President for Africa, Mr. Makhtar Diop, as saying, “Sustaining Africa’s strong growth over a longer term while significantly reducing poverty and strengthening people’s resilience to adversity may prove difficult because of the many internal and external uncertainties African countries face.