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26.05.2004 Business & Finance

Africa records growth in four years

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(From Gideon Sackitey, GNA Special Correspondent Munyonyo, Uganda. By Courtesy of GHACEM/Ministry of Finance)

Munyonyo (Kampala), May 25, GNA- African economies recorded a growth rate of 3.7 per cent last year, the highest in four years according to the African Development Report and the African Economic Outlook launched on Tuesday in Kampala, Uganda.

The two documents affirmed that growth in the region was achieved despite the weak growth in the global economy and continued structural and political constraints to improved performance in a number of countries.

They were launched during the on-going African Development Bank Group Meetings in Munyonyo in Kampala. The Reports, under the theme: "Africa In The Global Trading System," said output growth in Africa was accompanied by strengthening economic fundamentals and the restorations of peace and democracy in most parts of the continent, notably the Great Lakes Region, Angola and West Africa.

The ADR prepared by staff of the Bank, provides an in-depth review of the economic performance of Africa in 2003 from continental and sub-continental perspectives.

In a brief during the launch of the Report, Mr Nureldin Hussein, Manager of Research Division of the ADB, put growth rate in 2003 at 3.7 per cent as against 2.9 per cent in 2002.

He attributed the modest improvement in growth in 2003 to a combination of the continents more appropriate macroeconomic policies, rising non-fuel commodity prices, expansionary effects of global recovery and debt relief under the enhanced HIPC Initiative. This year, Africa is estimated to grow by 4.3 per cent, following the anticipated recovery of the global economy, higher primary commodity prices and moderate oil costs.

Mr Hussein said the issue of trade is at the heart of the debate on Africa's debt, the Highly Indebted Poor Countries (HIPC) Initiative and the sustainability of debt in the continent's quest for accelerated growth and poverty reduction.

The future of Africa he noted, would be determined virtually by its trade performance as stated by the Report that Africa's share in the world's exports declined to three per cent in 2003, compared to three per cent in 1990 and six per cent in 1980.

The Report was of the opinion that Africa must reverse the poor situation in international trade and pursue, a strategy of export-oriented industrialisation.

"This process has to begin with the rationalisation of the agrarian style and create those linkages with the urban industrial sector that would generate new synergies in terms of export diversification." African economies needed to evolve effective institutions for sound public management and development of a vibrant private sector, the report said.

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