Sub – Saharan Africa economic growth accelerates in 2018
NAIROBI, Kenya, Jan 8 – Sub Saharan Africa economic growth remained relatively strong in 2018.
This is according to the World Bank as preliminary data indicates that the region recorded a 2.7 percent GDP growth in 2018, a rise from 2.3 percent recorded in 2017.
In East Africa, a rebound in growth was recorded in Rwanda, Uganda and Kenya, which grew by 7.7 percent, 6.8 percent and 6 percent, respectively, as at the third quarter of 2018 driven by improved agricultural performance attributed to improved weather conditions.
A slowdown was however recorded in Tanzania mainly underpinned by an unfavorable investment climate following President John Magufuli’s stringent policy changes.
In Western Africa, several countries recorded growths of 6. Percent and above which include Benin, Burkina Faso, Cote d’Ivoire, and Senegal.
There was however subdued growth in other countries in the region such as Nigeria with the subdued growth being attributed to a decline in oil production, which was due to pipeline closures during the period.
In the Southern Africa region, growth was subdued in South Africa and Angola, which are the two major economies in the region.
Growth in Angola, the region’s second largest oil exporter was dampened by reduced oil output following the maturity of key oil fields.
Subdued growth in South Africa was mainly driven by weakness in agriculture, mining, and construction which dragged the economy into a technical recession due to negative growth recorded in two subsequent quarters in Q1’2018 and Q2’2018 at -2.6 percent and -0.4 percent, respectively.
The region is expected to perform well according to analysts at Cytonn Investments.
According to the analysts the growth will be supported by increased public spending on infrastructural development owing to the high demand for basic needs.
“Key risks remain difficult business conditions and poor infrastructure, reliance on commodity exports, political tension in some countries and debt sustainability due to high levels of public debt in most economies in the region,” the analysts predict.