Africa Is Now The Fastest Growing Continent In The World- AfDB Report

Kenyan engineers with Civicon Compnay taking a rest as they try to raise a tank in Mtwara Tanzania

Africa is now the fastest growing continent in the world a report by the African Development Bank (AfDB) has said.

The Report, ‘Annual Development Effectiveness Review 2013’ said the growth has been pushed by economic governance on the continent and the private sector.

It also places the positive growth on exploitation of oil and minerals and project more positive growth if assets are effectively managed and used in an accountable and transparent manner.”

 “Africa’s economic growth could not have happened without major improvement in economic governance as more than two-thirds of the continent has registered overall improvement in the quality of economic governance,” it said.

According to the report which is published online the costs of starting a business have fallen by more than two-thirds over the past seven years, while delays for starting a business have been halved.

Internal demand has also seen a growth in private sector which is the main engine of growth for the continent’s improved business climate.

“This progress has brought increased levels of trade and investment, with the annual rate of foreign investment increasing fivefold since 2000,” the report states.

The reports forecast a 5.5 per cent economic growth for continent’s low-income countries in coming years after growth exceeded 4.5 in 2012 forecast.

Africa’s collective gross domestic product (GDP) reached US $953 billion while the number of middle income countries on the continent rose to 26, out of a total of 54.

“This growth has reduced income poverty as the share of the population living below the poverty line has fallen from 51 per cent to 39 per cent,” it states.

Some 350 million Africans now earn between US $2-20 (Sh170-1,700) a day with the middle class is increasingly becoming an active consumer market.

However, the report warns of that the continent’s inadequate infrastructure and disparity in earning between rural and urban areas and slums remains a major constraint to the continent’s economic growth and development.

Strong emphasis should be placed in greater regional economic integration to improve prospects for growth by enabling African producers to build regional value chains, achieve economies of scale, increase intra-African trade and become internationally competitive.

Manuel Odeny © 2013

Ugandan researcher wins the AfDB 2012 Young African Economic award

Ugandan national economist has won this year’s award in the just concluded African Development Bank (AfDB) African Economic Conference in Kigali, Rwanda. 

Dick Nuwamanya Kamuganga an economist from the Graduate Institute of International and Development Studies in Geneva, won the award for his paper Does Intra-Africa Regional Trade Cooperation Enhance Export Survival.

Excerpts of the paper which was selected from among 500 submissions, which were narrowed down to 43 papers was presented during the conference at the  Regional Trade and Integration session.

Kamuganga’s paper explores long term African export relationship internationally and in intra‐African regional trade cooperation increase, It also examines the effects of intra‐regional trade cooperation on sustainability of Africa’s exports within Africa and to the rest of the world.

He argues that sustainable export expansion is a key priority for all African countries to achieve sustainable economic growth. Kamuganga’s findings suggest that regional trade cooperation, or integration, initiatives in Africa have non‐negligible effects on enhancing Africa’s export survival.

“He also shows that the depth of regional integration matters when it comes to lowering Africa’s export hazard rates relative to countries that are not in any regional cooperation,” AfDB says in an online statement.

“The research explains that actors such costs to export, transit delays (time to export), institutional and policies bureaucracy in  procedures to export and financial depth provide a natural framework for explaining the observable high hazard rates for African exports,” AfDB says.

His paper argues that financial underdevelopment in Africa could have a crucial role in restricting Africa’s export relationship survival.

The researcher argued that regional trade cooperation in Africa would greatly reduce export duration, and would result in a reduction in infrastructure-related trade frictional costs. Benefits of regional trade cooperation would include a reduction in border procedures, harmonization of documentation, product standards and elimination of border tariffs.

The award sought to recognize and encourage research among young Africans and only four research papers were shortlisted and given to a panel of judges to decide which one warranted the award for best conference paper by a young African scholar.

The basic criteria for the prize included that the paper should have been written a single author; the researcher should be under 40 years of age and from an African country; the paper should demonstrate innovation and relevancy in the area of economic policy, and should not have been presented anywhere prior to its presentation at the AEC in Kigali.

“The award which will be apart of the annual conference to boost young African researchers to be recognized by encouraging and inspiring research contribution among young Africans,” the United Nations Development Programme’s Sebastian Levine said.

The conference and the prize was funded by the UNDP, AfDB and the Economic Commission for Africa.

World Bank: Sub-Saharan Africa growth tied to Euro zone crisis

Ahmadou Moustapha Ndiaye, the Uganda WB country manager.

The World Bank’s forecast of 5% growth for Sub-Saharan Africa in 2012 risks being affected by the Euro zone, a senior bank official has said.

WB projections place the developing world, with Sub-Sahara Africa being the main player, at the centre of recovery from the world economic recession.

Last year, 2011, Sub-Saharan Africa had one of the world’s fastest growth rates at 4.7% average, almost back to the region’s performance before the economic crisis time.

Next year the growth is still projected to increase to 5.3%.

This forecast is placed at the risk of persistent risk of financial recession for developed countries especially after Cyprus asked for help from EU which “brings a lot of uncertainty in the air since developing countries are not isolated from the world” Ahmadou Moustapha Ndiaye, the Uganda WB country manager said.

He added that the Euro zone crisis will constrain growth in the developing countries as Euro governments will need to increase taxes and level on public investment to streamline their budget. This will affect the trade infrastructure and reduce foreign aid.

Ndiaye who was speaking to journalists at WB offices in Kampala said the effect will be felt through low remittance by African immigrants back home due to contracting job market and a reduced number of tourists visiting Africa as high income earners will be faced with new taxes.

But the forecast is set to hold steady if the prices of African commodities in the world market grow and investment flows into in new resources and infrastructure like oil drilling, refineries, roads, and ICT.  

Ndiaye points out that Africa can get finance from bilateral development partners to borrow and invest in infrastructure which will set to increase sub-regional trade which reduces their dependency on Euro zone countries and should place more importance on regional integration like EAC.

According to government’s record Kenya is projecting her growth at 5.0% in the 2012/13 financial year on the back of a SH1.459 trillion budget which highly relies on infrastructure development to spur growth.

“The energy, infrastructure and ICT sector leads on government’s expenditure at 24% allocation on account of on-going road and energy projects as the sector is able to sustain development” a PricewaterhouseCoopers, PwC, analysis points out.

But PwC says this can be challenged by a road maintenance backlog, lack of adequate local construction capacity and delayed uptake of donor funds.

Equally, the country’s budget which relies on 15.4% foreign funding (Sh225.5 billion) from external grants and loan for revenues will be constrained by the Euro zone crisis.

This reliance of sub-Sahara to external grants is what Ndiaye says can be rectified by regional integration and trade.

“Sub regional trade away from Euro-zone can be increased with EAC investing in infrastructure especially in oil exploration and speed up convergence in fiscal policies and the monitory union” he says.

©Manuel Odeny, 29 June 2012 from Reuters Training in Kampala, Uganda

You and Mr. Me in this trivial life of economic recession By Charles Jomo

The month is still twenty hungry with a delay of the pay slip. When a wall refuses to smile at you even after inserting a plastic card in it means the world is spinning like turning a ‘O’ upside down.

So we are walking downturn me and a colleague we will call Mr. Me, for the sake of this post. Being an extended twenty hungry period of the month, the description of our wallets, and workers drawing a salary is dismal. We couldn’t afford a hole in the middle of the doughnut t have two coins to rub together!

It's was late in the evening as a writer’s muse got me thinking on the greatest phenomenon in the world agenda has always been; the world moving on unmoved, unfazed at human kind hustles and bustle to define its place herein.

I mean, the world?

The economy stings creating a domino effect in people's wallets, with lies aligned with masks to hide their faces of oblivion from cruel reality in this time of the month. The humankind; women , men and children are in a merry go ground to transform corn, that is if afforded, into a corn meal we call ugali in East Africa.

Silvio Berlusconi, Italy PM got his ass kicked out from power, Barry Obama is getting Republicans sniffing his ass in White House because of the bloated economy. Guy Fawkes mask has got a reconnaissance of sought because of economic down turn.

If the big of the world can squirm why not a common mwananchi wa kawaida like you and me? Even encountered, which brings me to our friend Mr. Me, someone who try’s to look economically sound even in the face of economic disglut (cooked this one from disquiet)?

Earlier yesterday Mr. Me, a good time buddy, asks me if I could spare some roasted stuff. Those roasted maize found in every road side in Kenya and rake more millions than roasted meat, nyama choma, but since they are left for hoi polloi will never feaure in marketing the country.

You see, just to digress, nyama choma going down with beer is a social meal, but mahindi choma by the road side is a means of deprivation, a meal that cant be shared in a merry mood. First of all there is no water to wash your hands, making one to disregard his health over germs filled hands (at the back of hand washing campaigns) which is a sign of personal neglect!

Take a test with me Kenyans who chew on the roasted cob always look down trodden and in a pensive mood. Just take a cursory look today!

So back to my friend, the first ones we come across are rather stout and small in size and so we neglect them altogether. We soldier on and good heavens, we come to the next vendor (are they really vendors or roasters) and we go about to pick our like from the still hot.

It’s here that Mr. Me intrigues me. I pick a small rotund cob which looks young and succulent despite its size.  On the other hand my main man (stolen from Obama’s Dreams from my father) fuses with the roaster like a broke window shopper before settling for a big mature cob, with me picking the ‘bill’.

Being presumably richly well endowed with concern 4 human kind, I decide 2 let him have that which he desires in life because this way only, do we become great achievers.

a few steps from the point of purchase, Mr. Me complains about his cob.

“This damned maize is hard and tastes funny. I feel like throwing away this piece of shit!” He complains.

I'm then like: what the hell is wrong with you? You insisted in picking this cob as aligned with more grains?

“This cob will upset my stomach with this funny taste” Mr. Me complains, quietly feeling the hurt from his obnoxious behaviour towards my kindness.

What made me like his reaction rather than getting irritated is how he sounded more of a nag looking for attention from the reality of the economy than having any justifiable course.

Mr. Me complains, like lower middle class families facing inflation and completely disowns his role in accountability, or so I think.

And so I get a pissed off with the lad’s tirade and leave him alone as I retire to my abode, which is humble like the hackneyed phrase with a parting shot:

“My main man, i think your insolence has worked me up, see you morrows.”

That was earlier in the evening do now as I wait for my bachelor’s supper to cook it makes me think what really is the concern of man?

Life under recession, I muse, is a vicious cycle accorded to humankind all the days of its life. Inflation hits and the poor suffer most. They try to cover a hole from a leaking wall, but with powers against his strength the water ultimately rushes in and cover his life.

Without a leaning shoulder to guard against politicians insolence, the weak shilling (wherever it is) and skewed international trade balance the poor are completely caught unawares in the daily pangs of life and as a result, they never just anticipate any next, worthy courses of actions.

You live life as it comes; no planning for a tomorrow whose rouse is beyond your grasp.

May be, if only you and me force ourselves out of the boxes we're contained in and get to think outside these boxes, the world would then become one heaven of a place.     

(The writer is a graduate of English Literature from Maseno University, Kenya. He teaches at Migori Boys School)

Poem: Me and My Beggar by Otiato Guguyu

The Poet: Otiato Guguyu

it was in my ears -
the tingling coin
in his empty bowl
every empty dawn.

It was in his routine -
the timely nod
in grotesque gratitude
every begging morning

Today,
it was that same clanking coin
but there was no nod
my heart pride cherished gratitude
"but why"
"sir in the budget read yesterday
prices have inflated
but you still give me the same coin
I would be pleased if you raised your charity.

I walked away
tomorrow there would be no clanking

It would be a note!

©2008 Otiato Guguyu

The poet, Otiato Guguyu is a Communication and Media Technolgy with IT student at Maseno University Kenya, The Managing Editor of Equator Weekly and a Blogger at http://otiatoguguyu.blogspot.com