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The African Development Bank released on August 21 its latest edition of the West Africa Monitor Quarterly. The report follows key socio-economic developments in the region and provides brief analysis on latest events across the countries.
In its first section, the publication provides a regional overview of the main trends in the region, with the resurgence of violence in some countries, and the economic challenges faced by others.
“West Africa’s growth remains strong in the first half of the year and the region is arguably one of the fastest growth engines for Africa”, says Emanuele Santi, AfDB regional economist for West Africa and coordinator of the report.
The report also highlights the Ebola crisis as the major social development in some of the affected countries and of which the economic fallout is likely to be important.
The reversal in the downward trend in the price of commodities, both a blessing and a challenge, has strengthened the external position of commodities exporters while putting pressure on the balance of payments of others. Maintaining macroeconomic balances remains a challenge for many countries where fiscal policy has weakened and debt-to-GDP ratios have rapidly risen, such as Burkina Faso, Cape Verde, Gambia and Ghana. The risk of debt distress is increasing.
The second section offers a snapshot of recent development in several countries, namely Benin, Burkina Faso, Ghana, Guinea Bissau, Liberia, Mali, Niger, Nigeria and Senegal. These countries largely maintain a positive growth perspective while displaying varying levels of caution for different reasons, such as budgetary constraints, inflation, or security/political risks.
The third section is a thematic note on the State of Energy in West Africa, highlighting the key challenges, including the cost and pricing of energy production and provision, access and supply difficulties, the impact of the energy situation on the competitiveness of the region, and key challenges, such as infrastructure, financing, skills shortages and regulatory constraints. “Access to Energy remains a major impediment to the region’s competitiveness”, says Emanuele Santi, “but a wealth of opportunities remains, particularly with regards to renewable energy”. The report indicates that large potential exists in modern biomass, hydropower, solar and wind, most of which remains untapped. Only 16% of the region’s hydropower potential has been exploited; considerable wind speeds in the coast and desert zones allow for exploitation; the average daily irradiation in the region is far superior to the global average. The main challenges to tapping this potential include weak infrastructure and insufficient financing, regulatory constraints, and shortages of skills.