The International Monetary Fund (IMF) noted today in its October 2010 Regional Economic Outlook that "broad-based economic recovery...is now under way in sub-Saharan Africa." The Fund projects growth of 5% in the region for 2010 (up from prior estimates of a 4.5% expansion), and 5.5% for 2011. Driving factors of this growth include domestic demand and exports to Asian economies.
However, the IMF cautions that elevated unemployment and inherent political fragility, especially in middle income and oil exporting countries, remain a risk.
A press release summarizing the report can be found here, while the full text can be found here.
Additional commentary on the report by the Wall Street Journal, with an emphasis on the role of China, can also be found here.
October 11, 2010
Trade Within African Borders, and the Infrastructure it Requires
Obiageli Ezekwesili, Vice President for Africa at the World Bank has posted commentary on a meeting she recently attended called "Can Africa Trade with Africa?" in which leaders agreed that more should be done to promote intra-continental trade.
Ezekwesili noted that "intra-Afriacn trade remains among the lowest in the world - only about 10% of African trade is within the continent, compared to about 40% in North America and about 60% in Western Europe." Discussion seemed to focus on political solutions to this issue, with a push to increase communication and collaboration between states and organizations to promote growth.
However, it was interesting to note some comments from the private sector that were brough up during the meeting. According to Ezekwesili, the President of Coca Cola in South Africa pointed out that they would "only need about half of the current 163 plants in Africa if internal trade barriers were removed and transport services were improved." The opportunity for infrastucture development (and the firms that profit from it) is clear. If there is an economic opportunity for private sector firms to benefit from investment in infrastructure, they will be willing to pay to help that infrastructure develop. This in turn helps the firms that are contracted to build the necessary roads and facilities, and decreases the cost of doing business in between African nations.
Ezekwesili noted that "intra-Afriacn trade remains among the lowest in the world - only about 10% of African trade is within the continent, compared to about 40% in North America and about 60% in Western Europe." Discussion seemed to focus on political solutions to this issue, with a push to increase communication and collaboration between states and organizations to promote growth.
However, it was interesting to note some comments from the private sector that were brough up during the meeting. According to Ezekwesili, the President of Coca Cola in South Africa pointed out that they would "only need about half of the current 163 plants in Africa if internal trade barriers were removed and transport services were improved." The opportunity for infrastucture development (and the firms that profit from it) is clear. If there is an economic opportunity for private sector firms to benefit from investment in infrastructure, they will be willing to pay to help that infrastructure develop. This in turn helps the firms that are contracted to build the necessary roads and facilities, and decreases the cost of doing business in between African nations.
Subscribe to:
Posts (Atom)