Africa’s medium-term growth prospects for 2016 and 2017 remain positive with all risks and uncertainties including droughts, insecurity and political instability, the UN Economic Commission for Africa (ECA) official said on Friday.
In a paper presented on the overview of recent economic and social developments in Africa, during a meeting of the committee of experts on the sidelines of the inaugural African Development Week, Director Adam Elhiraika of the Macroeconomic Policy Division of the ECA said Africa’s growth will increase in the next year, driven by strong domestic demand of goods and investment.
However, Elhiraika told the experts that risks that include the weak recovery of the global economy and China’s economic slowdown, low commodity prices and the depreciation of major currencies, the tightening of monetary policy in the United States and the European Union, could hamper the expected growth.
Droughts and security and political instability were also cited as major stumbling blocks to Africa’s structural transformation.
“As a result we need to come up with African solutions to these risks if we are to witness the expected growth,” said Elhiraika.
“This includes strategies like adding value to our natural resources because in that way we create jobs that are on the low-end in the mining sector for example. We need to invest in agro-processing industries. Commodity price developments highlight the need for prudent and counter-cyclical macroeconomic management strategies and diversification from commodity sectors,” he said.
Elhiraika added that increased political stability on the continent would also spur growth through consumption and investment, adding that there is a need to increase intra-African trade as well as matching increasing urbanization on the continent with an industrialized process that provides required skills.
The creation of more jobs, Elhiraika said, would address many issues on the continent, including poverty reduction and inequalities.
Participants discussed many issues including how the continent can turn the fast-growing informal sector into formal jobs, the need for the continent to fund its own development agenda and the need to harmonize Africa’s developmental plans, among others.
African Development Week was officially launched Thursday, paving way for discussion around Africa’s economy, regional integration, investment and related issues. Major highlights of the week include the launching of the ECA’s flagship Economic Report for Africa 2016, country profiles, the Africa Governance Report, among others.
The Week is being held under the theme; “Towards an Integrated and Coherent Approach to The Implementation, Monitoring and Evaluation of Agenda 2063, and the Sustainable Development Goals.”
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