African Economy to Grow By 6% In 2014

African Economy to Grow By 6% In 2014
Nigeria, Angola and South Africa are top investment destinations in Africa

AFRICANGLOBE – Investment in infrastructure and production capacity in Africa will see the continent’s economy growing by 6% in 2014, according to the International Monetary Fund (IMF).

An IMF release on Thursday said Africa’s economic growth will rise to 6% from 5%.

“The main factor behind the continuing underlying growth in most of the region is … strong domestic demand, especially associated with investment in infrastructure and export capacity in many countries,” the IMF said.

Furthermore, low food prices and the extension of prudent monetary policies means inflation on the continent would be less than 6% in 2014.

“The improvement relative to 2013 reflects higher global growth, especially in Europe, and other expected favorable domestic conditions.”

The World Bank estimates growth of 5.3 percent for Africa in 2014, 0.7 percent less that the IMF projection.

South Africa, the continent’s largest economy is expected to grow 2% this year and 2.9% the following year.

Inflation in Africa is in its third year of decline.

The IMF recommended African nations allow their currencies to fall if they are being pressured by low commodity prices or capital outflows.

Nonetheless, the report revealed that the region remains vulnerable to lower commodity prices and a slowdown in developed and emerging economies.