World Bank decries Africa’s growth, seeks job creation
The World Bank has said that increased insecurity, lacklustre growth in the region’s strongest nations, and persisting uncertainty in the global economy are weighing on Sub-Saharan Africa’s (SSA) growth prospects.
This is stated in a World Bank statement on the current World Bank Africa’s Pulse Report for SSA, which was released on Wednesday.
According to the research, the economic picture for SSA remains gloomy, despite an elusive growth resurgence.
It predicted that economic growth in SSA will slow to 2.5 percent in 2023, down from 3.6 percent in 2022.
“South Africa’s Gross Domestic Product is expected to only grow by 0.5 per cent in 2023 as energy and transportation bottlenecks continue to bite.
“Nigeria and Angola are projected to grow at 2.9 per cent and 1.3 per cent respectively, due to lower international prices and currency pressures affecting oil and non-oil activity.”
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The report said increased conflict and violence in the region weighed on economic activity, and the rising fragility may be exacerbated by climatic shocks.
“In Sudan, economic activity is expected to contract by 12 per cent because of the internal conflict which is halting production, destroying human capital, and crippling state capacity. ”
It stated that in per capita terms, growth in SSA had not increased since 2015.
“The region is projected to contract at an annual average rate per capita of 0.1 per cent over 2015-2025, thus potentially marking a lost decade of growth in the aftermath of the 2014-15 plunge in commodity prices.
The statement quoted Andrew Dabalen, World Bank Chief Economist for Africa as saying:
“The region’s poorest and most vulnerable people continue to bear the economic brunt of this slowdown, as weak growth translates into slow poverty reduction and poor job growth.
“With up to 12 million young Africans entering the labour market across the region each year, it has never been more urgent for policymakers to transform their economies and deliver growth to people through better jobs.”
The report said in spite of the gloomy outlook, there were a few bright spots.
It said inflation was expected to decline from 9.3 per cent in 2022 to 7.3 per cent in 2023 and fiscal balances were improving in African countries that were pursuing prudent and coordinated macroeconomic policies.
“In 2023, the Eastern African community is expected to grow by 4.9 percent while the West African Economic and Monetary Union is set to grow by 5.1 percent.
However, the report said debt distress remained widespread with 21 countries at high risk of external debt distress or in debt distress as of June 2023.
It said overall, current growth rates in the region were inadequate to create enough high-quality jobs to meet increases in the working-age population.
“Current growth patterns generate only three million formal jobs annually, thus leaving many young people underemployed and engaged in casual, piecemeal, and unstable work that does not make full use of their skills.”
The report said creating job opportunities for the youth would drive inclusive growth and turn the continent’s demographic wealth into an economic dividend.
