6 Of The World's 10 Fastest Growing Economies This Year Are In Africa
By the looks of it, 2018 will be a great year for countries in Sub-Saharan Africa. The World bank is predicting a 3.2% economic growth in 2018 (it was 2.4% in 2017), and 3.5% in 2019; but much of that growth is hinged on improving commodity prices and executing economic reforms — and we are not great at that, to be honest.
And it's already showing. On the top ten fastest growing economies list, the top performers are countries that don't rely on commodities or its prices. Africa has six of the world’s ten fastest growing economies this year, according to the World Bank. The list includes Ghana (8.3%), which we should point out is boosted by oil & gas expansion, Ethiopia (8.2%), Côte d’Ivoire (7.2%), Djibouti (7%), Senegal (6.9%) and Tanzania (6.8%).
Unsurprisingly, the alternating giants of Africa, South Africa and Nigeria are not on the list. In fact, Sub Saharan Africa's growth average would have been higher (5%) if you excluded the big three economies of Nigeria, Angola, and South Africa from the region.
Nigeria and Angola are heavily dependent on oil and South Africa is riddled with structural problems (inherited from the apartheid era), so they have experienced slower growth than the rest of the region, significantly reducing the growth average. Nigeria only grew by 1% last year, and South Africa by 0.8%.
But it's not all bad news, oil prices are making a recovery, Brent crude hit a high of $70 last week, so that's good news for Nigeria and Angola. The world bank predicts a growth of 1.1% for South Africa, 1.6% for Angola and 2.5% for Nigeria.
But we're not going to achieve that number magically. The growth for us will be reliant on our government and policymakers implementing significant reforms to shift the growth model away from Nigeria's excessive reliance on oil, and proper debt management. So, we're not sure if to hold our breaths for that one.
By Olanrewaju Eweniyi, published on 17/01/2018