NAIROBI, Kenya and Tanzania will power economic growth in the East African SUB-region, which is expected to record the highest economic growth rate in Africa, according to the latest economic report from the African Development Bank (AfDB).
The Bank’s quarterly economic report says East Africa will record the fastest growth rate among the sub-regions of Africa at 5.4 per cent this year and then accelerate to 5.8 per cent in 2018. Growth in East Africa will be driven by strong domestic demand and high public infrastructure spending.
Kenya is expected to grow by 5.1 per cent while Tanzania’s economic will expand at a 7.2 per cent clip this year.
Despite a major slowdown in commodity prices, Africa retained its position as the second-fastest growing continent globally recording an average gross domestic product (GDP) GDP growth of 2.2 per cent, behind South Asia.
The East African region powered this growth with a 5.3 per cent economic expansion with the North African sub-region coming second at 3.3 per cent.
East Africa’s growth was driven by Kenya at 5.9 per cent and Ethiopia at 6.9 per cent. The AfDB says the expansion will be boosted by capital investment and strong domestic expenditure.
However, the Bank has downgraded economic growth for Africa, saying that poor weather will slow growth to 3.0 per cent.
The North African region is expected to grow by 3.1 per cent and 3.6 per cent in 2017 and 2018 respectively, with expected pick up of growth in Morocco of 4.5 per cent in 2017 and 3.9 per cent in 2018.
The bank however warns that continued political uncertainties and reduced oil production in Libya continue to drag growth in the North Africa region.
West Africa is expected to record improvements in growth to 2.5 per cent and 4.0 per cent in 2017 and 2018 respectively, mainly attributed to improvements in oil production in Nigeria and rising global commodity prices.
Improved mining prices will power growth in Southern Africa to 2.0 per cent and 2.3 per cent in 2017 and 2018 respectively.
Source: NAM NEWS NETWORK