Africa is looking forward to a prolonged rebound from the
crisis and a return to the sort of expansion it enjoyed
pre-crisis, African Development Bank (AfDB) president Donald
Kaberuka said yesterday.
I am bullish about Africa, he told Emerging
Markets in an interview. Africa has surprised the
world by the speed of its recovery.
Economic growth across the continent is expected to reach
5.9% in the next 12 months, compared with 5% in the past 12
months. Overall real GDP per capita has also
increased, Kaberuka said, except in a few countries that
have a strong demographic growth of more than 3% per annum.
The level of [foreign currency] reserves are being
rebuilt, foreign remittances have also built up, he said.
Foreign remittances from migrant workers are an important
source of foreign currencies for some African countries. Those
had fallen by 5% in the aftermath of the crisis, but have now
fully recovered, Kaberuka said.
I am very confident we shall go back to the momentum
built in the early 2000s. The speed of the recovery has been
remarkable. It is not concentrated in a few
Africa did not decouple from the rest of the world after the
crisis, and its economic fortunes remain tied to that of the
global economy. But Kaberuka believes that improvements in the
business environment will help it to overcome the impact of the
The way Africa has recovered from this crisis shows
that economic reforms over the past 15 years, the governance
reforms and the investment climate have made the continent much
more resilient than in the past.
The growth of trade, including intra-regional African trade,
is also responsible for the rebound. The way to look
forward is continue building capacity, lowering barriers and
constructing infrastructure, Kaberuka said.
Regional trade is estimated to have increased by 10-12% over
the past decade, according to Kaberuka. This is a positive
trend, but it is still minuscule compared to the growth of
Africa-China trade, which has grown more than 10 times over in
the last 10 years.
Paul Collier, economics professor at Oxford university, has
expressed reservations on infrastructure. Its not
just about building infrastructure, its about running
it, he said. He added that excitement about Chinese
investment was misplaced.
Large African economies are feeling the effect of the global
currency war. Pravin Gordhan, South Africas finance
minister, said: The currency has become too strong. We
share the concern of other emerging markets. The strong
rand affects export industries and can become
a negative on the competitiveness side.
South Africa is trying to build on the momentum of this
summers football World Cup, especially in terms of
attracting investment. We are in a very optimistic mood.
Africa has a much better profile around the world. Theres
a lot of goodwill towards the continent and the country as
well. Our task right now is how to capitalize on that, he
Among fragile countries, the best performance was registered
by Liberia, and to a lesser extent Sierra Leone, Burundi and
Chad. Meanwhile, Kaberuka voiced his continuing concern about
the situation in Sudan and Somalia.