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.

Ethiopia and the World Trade Organization

An official in Ethiopia's Ministry of Trade announced on 10 July 2013 that Ethiopia expects to join the World Trade Organization (WTO) by 2015.  Ethiopia first applied in 2003 and reopened negotiations in 2011.  There have been several sticking points, including Ethiopia's unwillingness to permit international banking and to open up the telecommunications sector. 

BBC radio interviewed me on 15 July 2013 concerning Ethiopia's request to join the WTO.  While I emphasized that negotiations are continuing between Ethiopia and the WTO Working Party, I thought it unlikely the Ministry of Trade would make such an announcement unless there had been significant progress in resolving the concerns about Ethiopia's request for membership.

For additional background on this subject, see Reuters' 10 July 2013 "Ethiopia Expected to Join WTO in 2015: Ministry" by Aaron Maasho and the Financial Times' 10 July 2013 "Ethiopia: We Live in WTO Hope" by Rob Minto.  For an update on this topic, see Bloomberg's 15 July 2013 article titled "Ethiopia Plans to Make WTO Offer on Services by September" by William Davison. 

For a list of the 159 current members of the WTO, click "Members and Observers."