The African Development Bank predicts that African GDP will experience a decline this year to 4.1% due to the persistence of the Covid-19 pandemic and the collateral effects of the war in Ukraine. However, Central Africa and tourist countries could do well.
The picture is rather gloomy overall, states the report on the economic prospects in Africa of the African Development Bank (ADB). After a significant rebound estimated at 6.9% in 2021, against the recession of 1.6% the previous year, African GDP growth is expected to fall back to 4.1% in 2022 and stagnate in 2023. Kevin Urama, Acting Chief Economist and Vice-President of the Bank, concedes: "The economic fundamentals are good for a large number of countries, but the efforts remain important."
The report says that Central Africa is expected to break out of the global trend, realizing a leap in its growth from 3.4% in 2021 to 4.2% in 2022. Experts believe that Cameroon - a large and diversified economy in the region - could do better if the country increases its oil production to take advantage of the global deficit caused by the war in Ukraine and the sanctions imposed on Russia. Meanwhile, the Democratic Republic of Congo (DRC) will accelerate in growth to 6.2% in 2022 and 2023, from 5.7% the last year. The largest French-speaking country in the world should capitalize on the rise in copper and cobalt prices and the investments in its mining sector.
West Africa should see growth globally frozen with a significant decline in Mali (2.1%) in 2022 due to ECOWAS and WAEMU sanctions. But the rebound could be there in 2023 if these sanctions are lifted.
Countries dependent on tourism should do well with a rebound in their overall growth to 5.6% in 2022, against 4.4% last year. Seychelles (5% and 5.9% in 2022 and 2023), Cape Verde (5.1% and 5.7%) and Mauritius (5.9% over the two years) are presented as the frontrunners. "The main driver of growth for this group has been the easing of restrictions on tourists," explain the study's authors.
In countries with less natural resources such as Benin or Rwanda, the economic dynamic could be supported by the increase in industrial and agricultural production, public investment in infrastructure projects, interregional trade and tourism growth. We know in particular that the Rwandan government is deploying a very offensive strategy to strengthen the destination's attractiveness.
"Resilience and vulnerability are linked to economic structure. If the Russian-Ukrainian war persists, the situation could escalate for several countries," said Kevin Urama. He believes that the African continent, the lowest emitter of greenhouse gases in the world, should gain access to funding to further develop towards zero-carbon policy.
Comments