How Nigeria, others slowed African growth rate – World Bank

The World Bank has said while the economic growth rate in the rest of sub-Saharan African region remain steady, same cannot be said for the likes of Nigeria, South Africa and Angola.

According to the bank’s latest issue of Africa’s Pulse, it revealed how slowed economic growth in some key African economies – Nigeria, South Africa, and Angola – is affecting the rest of the continent.

The report also disclosed that the earlier 3.1% economic growth forecast for the region is no longer feasible, even as the World Bank now projects a growth rate of just 2.7% in 2018.

It advises Governments in the region must take some decisive actions in order to facilitate faster economic growth, saying Nigeria, Angola and South Africa, which are also some of the biggest economies on the continent, experienced “sluggish expansion” which was caused by such factors as lower oil output (in Nigeria and Angola), and a contraction in South Africa’s Agric sector.

“The slower pace of the recovery in Sub-Saharan Africa is explained by the sluggish expansion in the region’s three largest economies. Lower oil production in Angola and Nigeria offset higher oil prices, and in South Africa, weak household consumption growth was compounded by a contraction in agriculture.”

The report also pointed out the high public debt of these countries, making them vulnerable. This is said to be as a result of a recent surge in Eurobond issuances.

It also said the large global shocks reshaped the inflow of foreign direct investment in Sub-Saharan African countries, while capital misallocation, inefficient capital/resource allocation are some of the factors limiting growth in the sector.

The report surmised that Governments in the region must “focus on investments that foster human capital, reduce resource misallocation and boost productivity” in order to ensure facilitate and sustain growth.