Figures released by the World Bank yesterday showed that annual growth in the region shrank to 2.3% in 2018 – down from 2.5% in 2017.
The bank’s bi-annual analysis of the state of African economies, Africa’s Pulse, indicates that although regional growth is set to rebound to 2.8% this year, it has hovered below 3% since 2015.
World Bank economists believe that the slower-than-expected overall performance reflects domestic macroeconomic instability including poorly managed debt, inflation, and deficits.
Although sluggish growth also reflects global insecurity, political and regulatory uncertainty persist and are having a negative impact on some economies.
The performance of sub-Saharan African countries was erratic, with Nigeria achieving growth of 1.9% in 2018, up from 0.8% in 2017, and South Africa coming out of recession.
But Angola, the region’s third largest economy, remained in recession, with growth falling sharply as oil production stayed weak.
Growth picked up in some resource-intensive-countries such as the Democratic Republic of Congo and Niger, as stronger mining production and commodity prices boosted activity.
In the Central African Economic and Monetary Community, a fragile recovery continued as reform efforts to reduce fiscal and external imbalances slowed in some countries.
Non-resource-intensive economies such as Kenya, Rwanda, Uganda, and several in the West African Economic and Monetary Union, recorded solid economic growth in 2018.
Africa’s Pulse also indicates that there were high hopes that a digital revolution can unlock inclusive growth and job creation across Africa.
“This is a game-changer for Africa,” said Albert Zeufack, World Bank chief economist for Africa.
“The digital transformation can increase growth by nearly two percentage points per year and reduce poverty by nearly one percentage point per year in sub-Saharan Africa alone.”
