Africa’s Economy Seen Growing Despite External Shocks

Africa’s economic growth remained stable in 2019 at 3.4 percent and is on course to pick up to 3.9 per cent in 2020 and 4.1 per cent in 2021, the African Development Bank’s (AfDB) 2020 African Economic Outlook (AEO) has stated.

The slower than expected growth was partly due to the moderate expansion of the continent’s big five countries — Algeria, Egypt, Morocco, Nigeria, and South Africa – whose joint growth was an average rate of 3.1 percent, compared with the average of 4.0 percent for the rest of the continent.

The Bank’s flagship publication, published annually since 2003, provides headline numbers on Africa’s economic performance and outlook. The 2020 edition, launched at the Bank’s Abidjan headquarters, was attended by former Liberian president Ellen Johnson Sirleaf, African ministers, diplomats, researchers, and representatives of various international bodies.

Johnson Sirleaf commended the Bank for upholding the confidence of the people of the continent “… because we trust you. As simple as that. Because we trust you to share our vision. We trust you to understand our limitations.”

Referring to Africa’s fastest-growing economies, she said, “There are stars among us…and we want to applaud them. We want to see more, particularly for countries like mine, which have been left behind, so that more can be done to give them the support that they need.”

In 2019, for the first time in a decade, investment expenditure, rather than consumption, accounted for over 50 per cent of Gross Domestic Product growth in the continent. 

This shift could help sustain and potentially accelerate future growth in Africa, increase the continent’s current and future productive base, while improving productivity of the workforce.

Overall, the forecast described the continent’s growth fundamentals as improved, driven by a gradual shift toward investments and net exports, and away from private consumption.

East Africa maintained its lead as the continent’s fastest-growing region, with average growth estimated at five per cent per cent in 2019; North Africa was the second fastest, at 4.1 per cent, while West Africa’s growth rose to 3.7 per cent in 2019, up from 3.4 per cent the year before.

Central Africa grew at 3.2 per cent in 2019, up from 2.7 per cent in 2018, while Southern Africa’s growth slowed considerably over the same period, from 1.2 per cent to 0.7 per cent, dragged down by the devastating cyclones Idai and Kenneth.

The AEO themed: ‘Developing Africa’s workforce for the future,’ called for swift action to address human capital development in African countries, where the quantity and quality of human capital was much lower than in other regions of the world.