Ochieng’ Ogodo
Journalist-Kenya
[NAIROBI] Many African countries have had an economic
slowdown but projections show that most African countries are having a positive
economic outlook.
According to the Institute of Chartered Accountants (ICAEW)
in England and Wales latest report in Economic
Insight: Africa Q3 2018 launched in Nairobi today, the regions include;
East Africa, West and Central Africa, Franc Zone, Northern Africa, Southern Africa.
The report that was commissioned by ICAEW and produced by
partner and forecaster, Oxford Economics, provides a snapshot of the region's
economic performance and reveals that East Africa continues to be the
continent's best performing region with a GDP forecast at 6.3 per cent.
This positive outlook is due to the region's economic
diversification and investment-driven growth. Ethiopia remains the region's
powerhouse, with growth forecast at 8.1 per cent due to the recent reforms
under Prime Minister, Abiy Ahmed.
Central and West Africa has a growth forecast at 2.9 per
cent, and the constrained growth in the region is due to subdued non-oil
economic activity by Nigeria - the region's powerhouse. The best performing
country in the region is Ghana with a forecast growth of 6.5 per cent.
Michael Armstrong, Regional Director, ICAEW Middle East,
Africa and South Asia say: "Despite the recent growth slump; all regions
in Africa are projected to report a positive economic outlook, with remittance
income expected to be a key economic booster in the coming months."
Growth in the African Francophone regions is forecast at 4.6
per cent, largely driven by a boost of 7.4 per cent in the region's biggest
economy, Ivory Coast, where investment is driving rapid expansion.
In North Africa, Egypt is forecast at 5.3 per cent as a
result of structural and policy reforms, which have boosted manufacturing and
investment. The county's tourism sector has also continued to recover. Similarly,
Libya is expected to record a growth of 16.5 per cent owing to posted
improvements in oil production after the civil conflict.
However, Southern Africa has been affected by continued slow
growth by the regional heavyweight South Africa, forecast at 1.5 per cent while
Angola, the region's other economic leader, has the same forecast of 1.5 per
cent. Strong growth in both Botswana and Zambia is said to have little effect
on the region's overall performance.
Remittance income was emphasised in the report as a major
economic factor for most African countries with Nigeria being the biggest
receiver of remittances on the continent. The West African economic powerhouse
received 29 per cent (US$ 22bn) of total remittances flowing to the continent
in 2017, mostly from the gulf, the US and United Kingdom.
Egypt came second on the continent with US$20 billion of
remittances. One of the countries highlighted where remittance flows continues
to play an important role in terms of external accounts is Ghana.
According to the World Bank, remittance inflows amounted to US$2.5bn
in 2014: equal to roughly 18.6 per cent of total exports that year. However, in
2017 the remittance inflows subsequently declined to US$2.2bn equivalent to
15.8 per cent of exports.
Uganda's economic growth was reported to have recovered
markedly last year. The country is expected to post a surplus of about 5.6 per
cent of the Gross Domestic Product –national wealth- this year, supported by
project aid and remittances inflows.
The full Economic Insight: Africa report can be found here: https://www.icaew.com/technical/economy/economic-insight/economic-insight-africa
