World Bank forecasts sub-Saharan Africa growth at 2.6 pct in 2017

The World Bank has projected the growth of Sub-Saharan Africa economy to rise to 2.6 percent in 2017 and further to 3.2 percent in 2018 and 3.5 percent in 2019.

The Bank however said in its Africa's Pulse report that recovery remains weak, with growth expected to rise only slightly above population growth, a pace that hampers efforts to boost employment and reduce poverty.

"A stronger-than-expected tightening of global financing conditions, weaker improvements in commodity prices, and a rise in protectionist sentiment represent downside external risks to the outlook," says the report which was launched in Nairobi on Wednesday.

According to the new Africa's Pulse, a bi-annual analysis of the state of African economies conducted by the World Bank, several oil exporters in the Central African Economic and Monetary Community (CEMAC) are facing economic difficulties.

The report says Nigeria, South Africa, and Angola, the continent's largest economies, are seeing a rebound from the sharp slowdown in 2016, but the recovery has been slow due to insufficient adjustment to low commodity prices and policy uncertainty.

The latest data reveal that seven countries (Cote d'Ivoire, Ethiopia, Kenya, Mali, Rwanda, Senegal and Tanzania) continue to exhibit economic resilience, supported by domestic demand, posting annual growth rates above 5.4 percent in 2015-2017.

"These countries house nearly 27 percent of the region's population and account for 13 percent of the region's total GDP," says Africa's Pulse.

Africa's Pulse notes that the continent's aggregate growth is expected to rise to 3.2 percent in 2018 and 3.5 percent in 2019, reflecting a recovery in the largest economies.

It will remain subdued for oil exporters, while metal exporters are projected to see a moderate uptick.

"With poverty rates still high, regaining the growth momentum is imperative," said Punam Chuhan-Pole, World Bank Lead Economist and the author of the report.

"Growth needs to be more inclusive and will involve tackling the slowdown in investment and the high trade logistics that stand in the way of competitiveness," she said.

The report calls for the urgent implementation of reforms to improve institutions that foster private sector growth, develop local capital markets, improve infrastructure, and strengthen domestic resource mobilization.

According to the report, GDP growth in countries whose economies depend less on extractive commodities should remain robust, underpinned by infrastructure investments, resilient services sectors, and the recovery of agricultural production.

This is especially the case for Ethiopia, Senegal, and Tanzania. The report says risks to the current recovery stem from an inadequate pace of reforms, rising security threats, and political volatility ahead of elections in some countries.

Albert G. Zeufack, World Bank Chief Economist for the Africa Region, called for the need to protect the right conditions for investment so that Sub-Saharan African countries achieve a more robust recovery.

"We need to implement reforms that increase the productivity of African workers and create a stable macroeconomic environment. Better and more productive jobs are instrumental to tackling poverty on the continent," Zeufack added. Endit