15.04.2005 Business & Finance

Africa hits record growth - IMF

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Economic growth in sub-Saharan Africa reached an eight-year high of 5% last year, according to a report by the International Monetary Fund. Inflation meanwhile fell to its lowest rate in 25 years.

The IMF said about 20 countries in the region had achieved growth of more than 5%, with inflation of less than 10%.

It warned though that African economies are still not growing fast enough to reach poverty reduction targets and that many are not business friendly.

The report says that oil producing countries such as Angola and Gabon benefited from high oil prices.

Oil importers, on the other hand, have had the pain of the rising price eased by the decline of the dollar - the currency in which oil is priced.

Cotton producers have been badly hit by declining prices.

Poverty targets

The report also says that many countries have followed policies agreed with the IMF - policies that have often proved controversial.

IMF Africa director Abdoulaye Bio-Tchane said the growth figures were an achievement worth mentioning.

"We have almost 20 countries today that are witnessing more than 5% of GDP growth and for the first time in 25 years you have inflation falling to less than 10%," he told the BBC.

However, the improvements recorded in economic performance are not enough to meet the United Nations Millennium Development Goals for reducing poverty.

Mr Bio-Tchane also said that 16 out of the world's worst 20 countries for business conditions are in sub-Saharan Africa.

The IMF regards a better climate for investment by business as essential for promoting stronger growth and poverty reduction.

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