Thursday, 15 November 2007

African economies growing steadily

Thursday, 15th November, 2007 E-mail article Print article

By Sylvia Juuko

AFRICAN economies have registered robust growth mainly fuelled by oil and mineral exports, a trend that is set to continue, the World Bank has said.

“Average growth in the sub-Saharan economies was 5.4% in 2005 and 2006, and the consensus projections are that growth will remain strong,” it said in a report published on Wednesday.

The report shows that exports rose from $182b in 2004 to $230b in 2005, representing a 26% rise.

It classifies African countries into three categories. The first group of seven countries comprises the seven major oil exporting economies, home to 27.7% of Africa’s population.

The second group of 18 countries, representing 35.6% of the region’s population, show diversified, sustained growth of 4%.

The third group of 17 countries, home to 36.7% of the population, is resource-poor, volatile, afflicted or emerging from conflicts, or in slow growth of less than 4%.

Uganda falls in the second category and is ranked number five with 6.1% growth.

Mozambique tops this list at 8.3%, followed by Rwanda (7.6%), Sao Tome and Principe (7.1%) and Botswana (6.7%).

The bank said for the first time in three decades, African economies are growing in tandem with the rest of the world.

“Something decidedly new is on the horizon in Africa, something that began in the mid-1990s. Many African economies appear to have turned the corner and moved to a path of faster and steadier economic growth.”

The report attributes the change in fortunes to improved policies, where inflation, budget deficits, exchange rates, and foreign debt payments are now more manageable. African countries have also improved in good governance and have stepped up efforts to fight corruption.

“These better economic fundamentals have helped to spur growth, but equally important to avoid the growth collapses that took place between 1975 and 1995,” the report says.

Rwanda and Uganda have made the greatest gains in life expectancy in the last decade, increasing by 12 and seven years respectively. Life expectancy, on the other hand, has decreased by 21 years in Botswana, 17 years in Lesotho and 16 years in Swaziland.

Uganda is one of the countries where national policies are re-oriented towards better education, the bank said. Private secondary education and training is expanding as well as emphasis on post-primary education.

The bank, however, calls for economic growth and development to be spread more equally within and among African countries.

“More than 40% in sub-Saharan Africa still live on less than $1 a day, life expectancy improvement has stalled in some countries, and poor health and poor schooling hold back improvements in people’s productivity.”

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