World Bank Lead Economist, Punam Chuhan-Pole says there is a need for African countries to diversify their economies as part of response to fluctuations that accompany economic recovery.
“For many African countries, the economic recovery is vulnerable to fluctuations in commodity prices and production,” said Chuhan-Pole, adding that “this underscores the need for countries to build resilience by pushing diversification strategies to the top of the policy agenda.”
The bank says the moderate pace of economic expansion reflects the gradual pick-up in growth in the region’s three largest economies, Nigeria, Angola and South Africa, forecasting that “elsewhere, economic activity will pick up in some metals exporters, as mining production and investment rise. Among non-resource intensive countries, solid growth, supported by infrastructure investment, will continue in the West African Economic and Monetary Union (WAEMU), led by Côte d’Ivoire and Senegal. Growth prospects have strengthened in most of East Africa, owing to improving agriculture sector growth following droughts and a rebound in private sector credit growth; in Ethiopia, growth will remain high, as government-led infrastructure investment continues.”
World Bank’s bi-annual analysis of the state of African economies projects that Sub-Saharan Africa’s growth will reach reach 3.1 percent in 2018, and average 3.6 percent in 2019–20.
The growth forecasts are premised on expectations that oil and metals prices will remain stable, and that governments in the region will implement reforms to address macroeconomic imbalances and boost investment.
Albert G. Zeufack, World Bank Chief Economist for the Africa Region, urges African Governments to speed up and deepen macroeconomic and structural reforms to achieve high and sustained levels of growth.