AFRICANGLOBE – In spite of Africa’s significant economic growth, expected to overtake the global average over the next three years, the World Bank has argued that it is up to the continent’s leaders to convert the projected growth into poverty reduction.
Global GDP growth average for 2013 is expected to hit 2.4 percent this year, against the combined average of African economies which is expected to grow by over 5 percent. Africa’s positive economic outlook is a result of higher commodity prices, increasing investment and a general improvement in the world economy.
But with labour unrest in South Africa, Ghana, Morocco, Tanzania, Kenya and Togo, amid political turmoil across the continent, the ability of African leaders to exploit the booming market and reduce poverty has been brought to the fore.
Experts say it is not an elusive request, as such growth has seen a reduction in poverty. The bank’s short-term figures showed that the percentage of Africans living on less than $1.25 a day fell from 58 percent to 48.5 percent between 1996 and 2010.
“If properly harnessed to unleash their full potential, these trends hold the promise of more growth, much less poverty, and accelerating shared prosperity for African countries in the foreseeable future,” World Bank economist, Punam Chuhan-Pole told reporters.
The challenge for African leaders, however, is addressing income inequality, and over-reliance on mineral and mining exports.
The World Bank said until these challenges are met the projected growth in African economy will not manifest into poverty reduction or alleviation.
“While the broad picture emerging from the data is that Africa’s economies have been expanding robustly and that poverty is coming down, the aggregate hides a great deal of diversity in performance, even among Africa’s faster growers,” Shanta Devarajan, the World Bank’s chief economist for Africa said.
According to the World Bank, the risks to African growth remained, not only from the continuing crisis in the Eurozone, but also from any sharp unforeseen downturn in demand for commodities from China.
But African leaders can dig in while it lasts. World Bank forecast for foreign direct investment is expected to reach record levels in the coming years, hitting $54bn a year by 2015.
The World Bank advises African leaders to seize the moment and invest in infrastructure, as this would be key to continued success of the oil wells of East and West Africa and the huge coal deposits in Southern Africa.
Currently, African nations with fewer natural resources are making better progress in combating poverty than resource-rich countries such as Equatorial Guinea, Nigeria and Gabon, the World Bank noted.
By: Konye Obaji Or