African economies are forecast to grow by an average of 6.2% in 2008, according to the latest edition of the Economic Report on Africa (ERA 2008), the annual joint flagship publication of the United Nations Economic Commission for Africa (ECA) and the African Union (AU), launched yesterday, April 1.
The report, Africa and the Monterrey Consensus: Tracking Performance and Progress, notes that African economies continued to sustain the growth momentum of previous years, recording an overall real GDP growth rate of 5.8% in 2007. Although 30 countries recorded higher economic growth rates in 2007 than 2006, growth performance varied substantially across countries and regions. The report also notes that economic growth recovery in Africa has not yet translated into meaningful social development and has not benefited vulnerable groups.
Africa's growth performance was driven mainly by robust global demand and high commodity prices. Other growth factors in Africa include continued consolidation of macroeconomic stability and improving macroeconomic management, greater commitment to economic reforms, increased private capital flows, debt relief and increasing non-fuel exports. Africa has also witnessed a decline in political conflicts and wars, especially in West and Central Africa, though peace remains fragile in some parts of the continent.
Key challenges to Africa's growth in 2008 include the risk of sharper slowdown in the US economy and a fall in global commodity demand and prices. Also high oil prices will hurt oil importers through the current account and inflationary pressures. In addition to political instability in some countries, inefficient public infrastructure and unreliable energy supply at the national level as well as poor integration of transportation and energy networks at the regional level continue to pose important constraints to Africa's growth.
In addition to a review of regional economic trends, the report assesses progress in Africa in the implementation of the 2002 Monterrey Consensus on financing for development (FfD).
According to ERA 2008, the evidence on implementation of the Monterrey Consensus commitments suggests that substantial progress has been made in the area of external debt relief. However, very limited progress has been made in the other core areas of the Consensus (mobilising domestic financial resources for development; mobilising international resources for development; promoting international trade as an engine of development; increasing international financial and technical cooperation for development; and addressing systemic issues).
The report stresses that the monitoring of the commitments made by African countries as well as their development partners is essential to achieve the objectives of the Monterrey Consensus. African leaders have recognised this and have put mechanisms in place to monitor progress with implementation of their own commitments as well as those of their development partners.
The establishment of an annual African Ministerial Conference on FfD by African leaders is a bold step forward in this area. The international community has also put mechanisms in place to monitor donor performance. It is hoped that these monitoring mechanisms will help to turn the promises made by development partners into deeds. The implementation of these commitments is important for Africa to achieve meaningful results in poverty reduction and lay the foundation for a brighter future for its peoples.
