AfDB: Championing inclusive growth across Africa. A blog by the former Chief Economist and Vice-President
For the past decade, Africa has had strong growth. A new economic momentum has been created. The continent weathered the financial crisis and has bounced back. But headline economic growth is not enough. Deliberate policies to reduce inequalities and promote inclusion are now needed more than ever before. It is time to focus on what people want: decent work, a living wage, access to basic service, more democracy and accountable governments. Africa and its people aim to be a pole of growth in the decades ahead. Read more
In recent years, mergers and acquisitions (M&A) activities have become an important channel for investment in Africa for both global and local market players. M&A deals have allowed companies to consolidate their positions in African markets, contributing to better market access and competitiveness.
In recent weeks, three of the world’s largest central banks namely the U.S. Federal Reserve, the European Central Bank and the Bank of Japan embarked on a new round of monetary easing. This is an unorthodox way of pumping money into the economy and lowering the long-term interest rates in order to combat the recession. Since interest rates in industrial countries had declined to near zero in the aftermath of the global crisis, the scope for further monetary easing through policy rates became very limited.
The performance of the African aviation industry is still lagging behind those of the rest of the world. Nonetheless, demand for air transport has increased steadily over the past years with passenger numbers and freight traffic growing by 45% and 80%, respectively. Over the period 2010-2015, Africa will be the third fastest growing region in the world in terms of international traffic with an average growth rate of 6.1% compared to the global average of 5.8%, and 7.9% and 6.9% for the Middle East and Asia Pacific, respectively, while Europe, Latin America and North America are projected to record lower international passenger growth of 5.0%, 5.8% and 4.9%, respectively.
Africa has made very good progress in institution building and in promoting democratic practices on the political front. However, there is some way to go in some countries where reversals of democratic practices have been reversed such as recently, in Mali. Indeed, the Arab spring revolutions also pint to challenges of in the area of Voice and Accountability, which is potentially explosive when combined with youth unemployment. One question is, are political elections outcomes in Africa random?
In recent years, Africa has experienced increased large-scale foreign investments in agriculture. A recent study estimates that more than half of the 56 million hectares of land sought after by foreign investors globally is located in sub-Saharan Africa. The Democratic Republic of Congo and Mozambique have the highest share of foreign investor driven land deals relative to total arable land of close to 50% and 21%, respectively.