Global crisis: AfDB drums support for diversification to grow economies

WITH a projection that African economies will grow at 4.5 per cent this year and five per cent in 2016 as a result of the rising demand for exports, the African Development Bank (AfDB) has said the continent must look forward to unlocking potentials of local economies to make growth more inclusive.

According to the 14th edition of African Economic Outlook 2015 released at the ongoing 50th Annual Meetings of the (AfDB), modernising local economies would be vital to make the continent more competitive and to increase people’s living standards.
The bank’s report said financial inflows would increase nearly 7 percent to 193 billion dollars, supported by higher foreign direct investment and a spike in portfolio investments.

It noted that transforming economies would require exploring more productive sectors, through promoting manufacturing, developing services, creating strategies for green growth or modernising the agricultural sector.

Acting Chief Economist and Vice-President of the AfDB Steve Kayizzi-Mugerwa said: “African countries have shown considerable resilience in the face of global economic adversity. For future growth to be sustainable and transformative will require that its benefits are shared more equitably among the population and that governments continue to pursue policies that promote economic stability.”

The AfDB said lower oil and commodity prices, uncertain global conditions, the consequences of the Ebola outbreak in West Africa and domestic political uncertainties could delay an expected return to pre-2008 levels of growth.