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WORLD BANK / AFRICA’S PULSE
STORY: WORLD BANK / AFRICA’S PULSE
TRT: 3:00
SOURCE: WORLD BANK
RESTRICTIONS: NONE
LANGUAGE: ENGLISH /NATS
DATELINE: 4 APRIL 2014, WASHINGTON D.C. - FILE
16 MAY 2012, ADDIS ABABA, ETHIOPIA
1. Wide shot, cityscape
2. Wide shot, cityscape with people on street
4 MARCH 2013, ACCRA, GHANA
3. MED SHOT, Woman in grocery store
4 APRIL 2014, WASHINGTON D.C.
4. SOUNDBITE (English), Punam Chuhan Pole, World Bank Lead Economist and Report Author:
“The region has continued to show strong growth, the average growth of countries was 4.7 percent in 2013, and growth continues to be broad based. Resource rich countries have grown at a strong pace for example Sierra Leone saw growth of over 13 percent, and the Democratic Republic of Congo came in at about 7 percent. Post conflict countries such as Cote d’Ivoire and Mali have also seen a rebound in growth. Growth remains strong in non-resource rich countries, for example, Ethiopia and Rwanda have seen growth of around 7 percent. Indeed, Sub-Saharan Africa continues to be among the fastest growing countries in the World. “
1 SEPTEMBER 2013, WASHINGTON D.C.
5. Wide shot, World Bank Headquarters
6. Med shot, sign at the entrance of the World Bank Headquarters
4 APRIL 2014, WASHINGTON D.C.
7. SOUNDBITE (English): Francisco Ferreira, World Bank Africa Region Chief Economist:
“With a more careful look at some of the statistics, there is also the recognition that there’s no room for complacency. For one thing, the demographic transition that has been expected for Africa is taking place at a slower rate than what was expected, so population growth rates continue to be quite high, around 2.5 percent per year. So that means that that great GDP that we talk about is slower when we talk about GDP per capita.
24 FEBRUARY 2014, KAMPALA, UGANDA
8. Med shot, street traffic
9. Wide shot, Kisasi Bukoto Road petrol station woman filling taxi with petrol
10. Close up, nozzle
4 APRIL 2014, WASHINGTON D.C.
11. SOUNDBITE (English): Punam Chuhan Pole, World Bank Lead Economist and Report Author:
“There are downside risks to the prospects. One risk on the external side is weaker commodity prices. African countries continue to be strongly reliant on natural resources, indeed about 75 percent of merchandise exports is made up of extractives, so weaker commodity prices will have implications for export earnings, and could have implications for foreign direct investment in the resources sector.
1 FEBRUARY 2012, MAPUTU, MOZAMBIQUE
12. Wide shot, ship in port
13. Close up, forklift operator
27 FEBRUARY 2012, MACHAKOS, KENYA
14. Wide shot, school children in classroom
4 APRIL 2014, WASHINGTON D.C.
15. SOUNDBITE (English): Francisco Ferreira, World Bank Africa Region Chief Economist:
“There has been a lot of growth in school enrollment for example, but the quality of the teaching is often not as good as we would like, the quality of the health services is not as good as we would like, there is room for lots of investment in Africa children, to make sure that when they grow up they are better informed citizens, more productive workers and better able to contribute to and participate in the economic growth.
16 MAY 2012, ADDIS ABABA, ETHIOPIA
16. Wide shot, street traffic
17. Wide shot, people in the market
10 NOVEMBER 2013, SAINT LOUIS REGION, SENEGAL
18. Med shot, women sort corn
19. Wide shot, irrigation in cornfield
Economic growth in Sub-Saharan Africa continues to rise from 4.7 percent in 2013 to a forecasted 5.2 percent in 2014. This performance is boosted by rising investment in natural resources and infrastructure, and strong household spending, according to the World Bank’s new Africa’s Pulse, a twice-yearly analysis of the issues shaping Africa’s economic prospects.
Growth was notably buoyant in resource-rich countries, including Sierra Leone and the Democratic Republic of Congo. It remained steady in Cote d’Ivoire, while rebounding in Mali, supported by improved political stability and security. Non-resource-rich countries, particularly Ethiopia and Rwanda, also experienced solid economic growth in 2013.
Capital flows to Sub-Saharan Africa continued to rise, reaching an estimated 5.3 percent of regional GDP in 2013, significantly above the developing-country average of 3.9 percent. Net foreign direct investment (FDI) inflows to the region grew 16 percent to a near-record $43 billion in 2013, boosted by new oil and gas discoveries in many countries including Angola, Mozambique, and Tanzania.
With lower international food and fuel prices, and prudent monetary policy, inflation slowed in the region, growing at an annual rate of 6.3 percent in 2013, compared with 10.7 percent a year ago. Some countries, such as Ghana and Malawi, have seen an uptick in inflation because of depreciating currencies.
Remittances to the region grew 6.2 percent to $32 billion in 2013, exceeding the record of $30 billion reached in 2011. These inflows, combined with lower food prices, boosted household real incomes and spending.
Tourism also grew notably in 2013, helping to support the balance of payments of many countries in the region. According to the UN World Tourism Organization, international tourist arrivals in Sub-Saharan Africa grew by 5.2 percent in 2013, reaching a record 36 million, up from 34 million in 2012, contributing to government revenue, private incomes, and jobs.
African countries are now routinely among the world’s fastest-growing countries as a result of sound macroeconomic reforms in recent years and the fact that the rest of the world has steadily updated its reality of the continent as a high opportunity region for trade, investment, business, science and technology, and tourism.
Africa’s Pulse says that the region’s infrastructure deficit is most acute in energy and roads and that across Africa, unreliable and expensive electricity supply and poor road conditions continue to impose high costs on business and intra-regional trade.
Africa’s Pulse notes that while GDP growth in the region is expected to remain stronger than in many other developing countries worldwide, a number of important risks remain.
Commodity prices--weaker demand for metals and other key commodities, combined with increased supply, could lead to a sharper decline in commodity prices. In particular, if Chinese demand, which accounts for about 45 percent of total copper demand and a large share of global iron ore demand, remains weaker than in recent years and supply continues to grow robustly, copper and iron ore prices could decline more sharply, with significant negative consequences for the metal-producing countries.
Locally volatile food prices--within Sub-Saharan Africa, strong local price pressures have emerged in a number of countries driven in part by large currency depreciations, as in Ghana and Zambia, and also by unfavorable weather conditions. In francophone West Africa, drought in 2013 resulted in crop losses of up to 50 percent in parts of the Sahel region.
Larger currency depreciations and lower local harvests due to intensifying drought conditions could hurt poor buyers, and result in higher inflation.
Increasing integration with larger regional markets can reduce the magnitude of the price effects from localized shocks, while lower trade barriers and better trade infrastructure would allow faster and more efficient response to localized food shortages.
Political uncertainty--domestic risks associated with social and political unrest, and emerging security problems, remain a major threat to the economic prospects of a number of countries in the region.
In South Sudan, a ceasefire, signed between the conflicting sides on January 23, 2014, remains tenuous, and sporadic violence has continued to disrupt oil production.
In the Central African Republic, insecurity and large-scale displacement of persons are severely disrupting economic activity and livelihoods. Also on the domestic front, upcoming national elections in several countries may slow the pace of much-needed structural reforms.
In a special analysis of the region’s growth and trade patterns in Africa, Africa’s Pulse says that export diversification remains a tough challenge for many African countries, especially oil producers.
Total exports to the BRICs (Brazil, Russia, India and China) surpassed the region’s exports to the European Union (EU) market in 2010 and continue to grow.
In 2012, the region’s exports to the BRICs reached $145 billion. China alone accounted for about a quarter (23.3 percent) of the region’s total merchandise exports. Of course, this shift in trading partners also underscores the region’s vulnerability to any slowdown in the BRICs, particularly China.
Africa’s Pulse notes that globalization of services is a potentially important source of growth for developing countries. Technology and outsourcing are enabling traditional services to overcome their old constraints such as physical and geographic proximity.
Modern services, such as software development, call centers, and outsourced business processes, can be traded like value-added, manufactured products, enabling developing countries that focus on such services, innovation, and technology to leverage services as an important driver of growth.
At over $50 billion, the region’s services exports trail all other developing regions; however, it is expanding annually at about 12 percent, on average. Traditional services such as transportation and travel have declined from 73 percent of total services exports in 2005 to less than 64 percent in 2012, while modern services exports in the region have increased their share by nearly 10 percentage points from just over 26 percent of total services exports to about 36 percent over the same period.
In some countries such as Mauritius, Rwanda, and Tanzania, modern services exports recorded annual growth rates of over 10 percent between 2005 and 2012, with Rwanda starting from a low base of less than $40 million in services exported in 2005 to over twice that amount at almost $85 million by 2012.
In both Mauritius and Rwanda, rapid expansion in modern services is a result of increased activity in tradable business and financial services. Over 60 percent of those employed in large companies in Mauritius work in the service sector, which offers more employment opportunities than either agriculture or manufacturing.
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