According to a new report by the World Bank on Africa’s economy, economic growth in Sub-Saharan Africa remains strong: excluding South Africa, which accounts for over a third of the region’s GDP, in 2011 growth in the rest of region was 5.9 percent, making it one of the fastest growing developing regions.
“Despite of the global crisis, African economies continue to show resilience and some of the fastest-growing economies in the world are now in Africa. The urgent agenda remains sustaining the macroeconomic reforms while accelerating the structural reforms that will deliver the right quality of growth that creates jobs and raises incomes on the continent,” says Obiageli ‘Oby’ Ezekwesili, The World Bank’s Vice President for Africa, and a former Nigerian Minister of Mineral Resources.
However, the Euro zone debt crisis and tighter domestic policies in some large developing countries pushed African exports lower in late 2011 and also affected tourist arrivals in the region.
On the other hand, in a significant development, the World Bank says that overall capital flows to Sub-Saharan Africa rose by $8 billion in 2011 to $48.2 billion. Foreign direct investment, which accounts for about 77 percent of all capital flows to the region, contributed to about 83 percent of the increase.
Such trend has been spurred by increased global competition for natural resources, higher commodity prices, robust economic growth and a fast rising middle class.
Nonetheless, the African continent still faces a challenging future. As Oby Ezekwesili points out, the famine in the Horn of Africa last year and the drought in the Sahel this year are cruel reminders that Africa, the continent that contributed the least to greenhouse gas emissions, is likely to be the most hurt by climate change.