World Bank’s (WB) April 2019 issue of Africa’s Pulse report downgraded Sub-Saharan Africa’s growth to 2.3 per cent for 2018 from 2.5 per cent in 2017.
The region’s economic growth remains below population growth for the fourth consecutive year and is predicted to remain below three per cent since 2015 despite an expected rebound to 2.8 per cent in 2019 according to a press release produced by the WB.
“The slower-than-expected overall growth reflects ongoing global uncertainty, but increasingly comes from domestic macroeconomic instability including poorly managed debt, inflation, and deficits; political and regulatory uncertainty; and fragility that are having visible negative impacts on some African economies,”a World Bank press release says.
“It also belies stronger performance in several smaller economies that continue to grow steadily.”
Africa’s pulse also found out that fragility in a handful of countries is costing Sub-Saharan Africa over half a percentage point of growth per year adding up to 2.6 percentage points over five years.
Fragility in countries is characterised by economic and social impairedness. This may include weak institutional capacities, poor governance, economic and geographic isolation, economic and social disruption; and also insecurity.
“The drivers of fragility have evolved over time, and so too must the solutions,” said Cesar Calderon, Lead Economist and Lead author of the report.
“Countries have a real opportunity to move from fragility to opportunity by cooperating across borders to tackle instability, violence, and climate change.”
The WB believes that the digital economy, which includes the use of ICTs and mobile money on transactions, can help the continent move forward.
“The digital transformation can increase growth by nearly two percentage points per year and reduce poverty by nearly one percentage point per year in Sub-Saharan Africa alone. This is a game-changer for Africa,” said Albert Zeufack, World Bank Chief Economist for Africa.