The World Bank, yesterday, disclosed how slowed economic growth in some key African economies – Nigeria, South Africa, and Angola – is affecting the rest of the continent.
In a report it was disclosed that the earlier 3.1% economic growth forecast for the region is no longer feasible, even as the World Bank now projects a growth rate of just 2.7% in 2018. Governments in the region must take some decisive actions in order to facilitate faster economic growth.
As noted earlier, the World Bank said that while the economic growth rate in the rest of the sub-Saharan Africa region was steady, same cannot be said for the likes of Nigeria, South Africa and Angola.
These three African countries, which are also some of the biggest economies on the continent, experienced “sluggish expansion” which was caused by such factors as lower oil output (in Nigeria and Angola), and a contraction in South Africa’s Agric sector.
Other issues highlighted in the report
- Public debt in the region is high and many countries there are vulnerable. This is said to be as a result of a recent surge in Eurobond issuances.
- Large global shocks reshaped the inflow of foreign direct investment in Sub-Saharan African countries.
- Capital misallocation, inefficient capital/resource allocation are some of the factors limiting growth in the sector.
- Growth will continue gradually; to increase from 2.7% to 3.3% in 2010.
The report surmised that Governments in the region must “focus on investments that foster human capital, reduce resource misallocation and boost productivity” in order to ensure, facilitate and sustain growth.