Editor’s Note: April 09, 2019
Africa (still) has a growth problem
Sub-Saharan African economies will average GDP growth of 2.8% in 2019, according to the World Bank’s latest regional outlook. This is a downward revision from 3.3% forecast last October.
While this masks variations among countries – growth ranges from more than 8% in Ethiopia to -1.9% in Sudan – it’s a worrying number.
At current rates, the Bank warns, the region will fail to eradicate extreme poverty by 2030, in line with the UN’s Sustainable Development Goals.
This is only part of the problem. Higher growth does not necessarily mean economic development.
It’s something sub-Saharan African economies have known since the heyday of GDP growth in the region before the commodities slump in 2014-15. Prior to this the average was higher than 5%, almost double the current figure.
Yet this has had little impact on poverty reduction,economic inequality, and job creation. In absolute terms the number of poor people in the region has actually increased.
The problem is that growth is not inclusive. Causes of this range from limited structural reform, to a lack of investment into productive sectors and activities, as well as a reliance on commodity prices to drive GDP figures.
Put differently Africa (still) needs better growth, not just more of it.
From The Continent
A South African court on Monday ruled that former Mozambican finance minister Manuel Chang can be extradited either to the U.S. or his home country, over his alleged role in a $2bn loan scandal. This is in relation to shady borrowing for a fleet of Tuna fishing boats in 2013-14, which has helped plunge the country into a debt crisis. More: Bloomberg
Sudan’s military has said it is not “against the demands” of protesters calling for the country’s longtime president Omar al-Bashir to step down, the latest sign of his waning grip on power. Protests against his 30-year rule - which were sparked by an acute economic crisis - are into their fifth month. More: Al Jazeera
The Daily Stat
The amount Zimbabwe has set aside in this year’s budget to compensate white farmers that were evicted during its chaotic land reform programme under Robert Mugabe in the early 2000s. More:Reuters
The Global Perspective
Social media giant Facebook is reportedly considering plans to build a subsea data cable around Africa to reduce bandwidth costs and boost user numbers on the continent. The project is apparently called ‘Simba’, after the main character in Disney’s animated movie The Lion King. More: MarketWatch
San Francisco-based tech startup Branch International, which provides mobile based lending in emerging markets, has raised $170m in a series C round led Foundation Capital and Visa. The company’s African markets include Kenya, Nigeria and Tanzania. More: TechCrunch