European crisis remains a danger for Africa – economist

2012-07-31 15:30

African economies are growing amid bleak global conditions but the continent risks contamination from Europe’s woes, a top economist has said.

“Every country is showing growth, that is the story: there is no country in Africa which is in the red,” Mthuli Ncube, chief economist and vice president at the African Development Bank told AFP.

His figures do not include troubled Somalia and South Sudan.

“The lowest rate is in Swaziland with 0.8%. Even in North Africa: Tunisia recovered, Egypt recovered, Libya recovered in a big way,” said Ncube, referring to the bank’s growth estimates for mid-2012 to mid-2013.

“Even the worst countries are doing on average even slightly better than Europe.”

The European crisis, which has hit tourism and led to falling raw material exports and a possible decline in investment and aid, remains a danger for Africa, warned Ncube.

“Any one percent drop in Europe’s GDP would lead easily in a half a percent drop in Africa’s GDP.”

Among the Africa’s economies set for the fastest growth from mid-2012 to mid-2013 are Libya with an expected growth rate of 14.8% after civil war saw the GDP plummet by more than 40% last year.

Ranging from just over seven percent to 8% growth are the Ivory Coast, Zambia, Ethiopia, Rwanda, Angola, Mozambique, Ghana and Liberia. In Niger, 8.6% is forecast.

“We are not claiming by any means that this growth is inclusive, that it is creating lots of jobs, we are not claiming none of that, but it is growth nevertheless, and that is welcome,” said Ncube.

The continent’s powerhouse, South Africa, is among the slower performers, estimated to grow 2.9%, with its more integrated economy vulnerable to global tremors.

Growth in sub-Saharan Africa is forecast at 5.3% this year and 5.4% in 2013 – 6.3% for both years if South Africa is excluded – according to forecasts compiled with the OECD and the United Nations.

Growth in the whole of Africa is forecast to increase to 4.5% this year and 4.8% in 2013.

While those figures are significantly higher than in many Western economies, part of the gains are cancelled out by high population growth, which averages close to 3% in sub-Saharan Africa.

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