African economies have been resilient to negative shocks, but poor infrastructure is a serious impediment to inclusive growth, according to the 2018 edition of the African Economic Outlook (AEO) presented to delegates in Addis Ababa at the African Union Summit on Friday.
The African Economic Outlook – the African Development Bank’s flagship analysis of the state of African economies – was presented to key stakeholders on the sidelines of the ongoing 30th Ordinary Session of the Assembly of the Heads of State and Government of the African Union (AU) in the Ethiopian capital.
As a leading African institution, the bank is the first to provide headline numbers on Africa’s macro-economic performance and outlook.
The bank’s Chief Economist and Vice-President for Economic Governance and Knowledge Management, Célestin Monga, said the report was presented in January to give policy-makers enough time to reflect on the recommendations for economic planning and transformation.
“The bank is also translating the report into key African languages and engaging with policy-makers and civil society organisations to ensure its operationalisation,” he said.
Beyond the observed increase in GDP, Monga called for structural change in Africa. Amani Abou-Zeid, Commissioner for Infrastructure and Energy at the African Union Commission, described the report as highly relevant and useful for governments and other stakeholders.
The African Economic Outlook puts average real Gross Domestic Product (GDP) growth in Africa at 3.6 per cent in 2017 “ a good recovery from the 2.2 per cent recorded in 2016. The 2017 figure is projected to grow by 4.1 per cent a year in 2018 and 2019.
Growth was driven by improved global economic conditions, better macro-economic management, recovery in commodity prices (mainly oil and metals), sustained domestic demand (partly met by import substitution), and improvements in agriculture production.
However, Africa is still experiencing jobless growth due largely to limited structural change. Consequently, sustained high growth has not had substantial impact on job creation. About two thirds of countries in Africa have experienced growth acceleration.
“Basically, a growth acceleration period is one in which the average growth rate of GDP per capita over a period of eight years is at least 3.5 per cent per annum,” the report notes.