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Inclusive growth hinges on local economies, says report
Modernizing local economies will be vital to making Africa more competitive and to increase its living standards, as the continentâs population is set to triple by 2050, the African Economic Outlook 2015 has said
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odernizing local economies will be vital to making Africa more competitive and to increase its living standards, as the continent's population is set to triple by 2050, the African Economic Outlook 2015 has said.
The report says that surpassing most regions despite the global financial crisis, African economies will grow by 4.5 percent in 2015 and may reach 5 percent in 2016, converging with Asia's current growth rates.
It adds, however, that lower oil and commodity prices, uncertain global conditions, the consequences of the Ebola outbreak in West Africa and domestic political uncertainty could delay an expected return to pre-2008 levels of growth.
'Foreign direct investment [FDI] is forecast to reach US$73.5 billion in 2015, underpinned by increasing greenfield investment from China, which remains Africa's largest trade partner after the EU,' said the report, released at the African Development Bank Group's 50th Annual Meeting, on Monday.
The report also shows an increase in intra-African and outward FDI flows. South African companies are the leading investors on the continent.
'African countries have shown considerable resilience in the face of global economic adversity. For future growth to be sustainable and transformative, it will require that the benefits are shared more equitably among the population and that governments continue to pursue policies that promote economic stability,' African Development Bank acting chief economist and vice president Steve Kayizzi-Mugerwa said.
Human development levels in Africa have increased since 2000, with 17 out of 52 countries reaching middle or high levels of development, but the region's poverty rates remain stubbornly high while progress in health, education and income are uneven.
Huge inequalities persist between and within countries and between women and men. In many areas, low productivity and investment, the absence of infrastructure and rural-urban networks and too few jobs outside the agricultural sector are holding back economic and development progress.
'African economies could benefit from mobilizing the wide and extraordinary untapped potential of their diverse regions. Putting people and places at the center of policy-making may improve Africa's competitiveness and the well-being of Africans,' said OECD Development Center director Mario Pezzini. (ebf)(++++)
