African families could've been 35% wealthier with sustained growth – World Bank

  Thu, 11 Apr 2024
Economy & Investments African families could've been 35 wealthier with sustained growth – World Bank

Andrew Dabalen, the Chief Economist for the Africa Region at the World Bank, has emphasized that if growth had been sustained over the past 14 years, African families would have been 35% wealthier.

These remarks were part of the discussions surrounding the World Bank's Africa Pulse Report for April 2024.

During an interview with Bernard Avle on the Point of View programme on Citi TV, Dabalen pointed out that despite growth rates in Africa being lower, the continent struggles to maintain them over an extended period.

He further highlighted that the rate at which growth in Africa reduces poverty is only half of what is observed globally.

Drawing comparisons with East Asia, Dabalen noted that economic recovery from downturns in Africa tends to be short-lived, whereas in East Asia, it persists for a longer duration before faltering.

This observation sheds light on the disparities in economic resilience and sustainability between the two regions.

“Africa’s growth has been traditionally low compared to other regions being in the same situation as Africa, such as East Asia for instance. And it has been very difficult to sustain over a long period of time. Countries in Asia and Africa went through a recession, there’s an economic downturn we have had the experience.

“Let’s say there’s a recovery, the recovery in Africa lasts maybe three years and then a shock comes, and it falters. It doesn’t sustain. Recovery in East Asia takes about eight years before it falters, that is a huge difference.

He added, “Not only do you find Africa’s growth is lower, but you also find it is not sustained over a long period. And because of that, it’s extremely costly. If Africa’s growth was sustained at the rate at which it grew, it’s not high, but even if it was sustained between 2002 and 2014, that window of 14 years, African families would be 35% richer than they are now. That is the kind of things that give you a sense of how completely costly this low growth has been.

“The speed at which Africa’s growth reduces poverty is only half of what we see in the rest of the world. East Asia is much higher.”