Burundi Economic Outlook
- The economy is expected to record moderate growth in 2012 and 2013.
- Structural reforms and the fight against poverty are hampered by the inadequacies of the country’s institutions and political instability.
- The high rate of youth unemployment is a major challenge which Burundi has to confront.
An upturn in coffee production and building activity should help towards moderate growth in 2012 and 2013. But this growth will be vulnerable to fluctuations in oil prices, weather conditions, delicate social conditions and uncertainties linked to external aid. Internal resources need to be mobilised through continuing structural reforms and better economic governance, with a view to reducing the country’s reliance on external funding. If the management of the country’s finances is to be improved the state needs, in particular, to disengage from the coffee sector and to develop publicprivate partnerships in the energy sector. Politically, the opposition boycott of the last presidential election in June 2010 has raised fears about Burundi’s political stability.
On the social front the country has made significant progress in the implementation of policies providing for free education and health. It now needs to address the highrate (put at almost 60%) of youth unemployment, which constitutes a threat to social stability. This high level can be explained by a number of factors. The formal private sector is poorly developed and hesitates to take on young people without professional experience. The public sector is reluctant to recruit at a time when the overall wage bill needs to be controlled, there is strong population growth, and training and education are often too theory-based and mismatched to demand.
