Saturday, January 19, 2019

African Economic Outlook 2019

The African Development Bank has just released its African Economic Outlook 2019 in English, French and Portuguese.

After tepid real GDP growth of only 2.1 percent in 2016, Africa's economy recovered with 3.6 percent growth in 2017 and 3.5 percent growth in 2018. Growth is expected to accelerate to 4 percent in 2019 and 4.1 percent in 2020. In 2019, 40 percent of African economies are projected to see growth of at least 5 percent.

Five trade policy actions could potentially bring Africa's total gains in 2019 to 4.5 percent of its GDP:

--eliminating all applied bilateral tariffs in Africa;
--keeping rules of origin simple, flexible, and transparent;
--removing all nontariff barriers on goods and services;
--implementing the World Trade Organizations's Trade Facilitation Agreement to reduce cross border time and transaction costs tied to nontariff measures; and
--negotiating with other developing countries to reduce their tariffs and nontariff barriers by 50 percent.

Africa faces an urgent need to create jobs in higher productivity sectors by developing a strong manufacturing sector. This will not be achieved, however, if constraints to doing business such as poor governance, low institutional quality, and inadequate infrastructure continue to limit firm survival and dynamism. At the current rate of labor force growth, Africa needs to create about 12 million new jobs every year to prevent unemployment from rising.