The State of Sub-Saharan Africa

The State of the “Sub-Saharan Africa” – Growth Outlook
According to the 2008 World Economic Outlook1 released by the International Monetary Fund this past April, the GDP for Sub-Saharan Africa (SSA) which includes the Great Lakes, Southern Africa, the Horn of Africa, South Africa, the West and Central Africa is projected to be 6.8 per cent for 2008 compared to 3.4 per cent in 2005 2. Some of the countries leading the pact are Angola with 16 per cent, Nigeria 9.1 per cent, the Democratic Republic of Congo 8.8 per cent and Ethiopia 8.4 percent.
The implementation of economic reforms and the strengthening of financial conditions in this region have seen foreign direct investment (FDI), useful indicators of economic health and investments appeal, remaining relatively strong since 20062. In 2007, the rise of investments for Africa accounted more than $37 billions in both FDI and through Mergers and Acquisitions. This inflow of foreign direct investment is geographical and selective, largely concentrated in the petroleum and manufacturing sectors. The global credit market crunch will impact the inflows of FDI to the region for the rest of the year if conditions remain unchanged.
An interesting initiative announced by the World Bank Group President Robert B. Zoellick known as the Extractive Industries Transparency Initiative Plus Plus (EITI++)3 last April, would help developing countries manage and transform their natural resource wealth into long-term economic growth that spreads the benefits more fairly among their people. With commodity price being at historic highs, many Sub-Saharan Africa nations must consider taking this opportunity to strengthen their balance sheet.
Although the region has seen some stability in its GDP since 20061, political and security risks remain. The insecurity of the Democratic Republic of Congo in its eastern region, or the political mayhem in Kenya could have tremendous impact in the Great Lakes region and could leads to its downfall.
The region outlook is on a positive trend as long as these countries continue to implement and strengthen sound macroeconomic policy framework, take advantages of the many opportunities offered by globalization, continue investing in infrastructures, institutions and human resources, diversify their economy and technology in order to remain on this up trend of growth and competitiveness in this global market.
By and large, Africa has come a long way and many challenges remain ahead. Overcoming them will require persistence, patience and pride of ownership of development.

References used:
1 April 2008 IMF – World Economic Outlook
2 United Nations Conference On Trade and Development - 2007 Economic Development In Africa
3 WorldBank.Org
4 Congo Magazine