Jun 1 , 2024
In a compelling address, Akinwumi Adesina (PhD), president of the African Development Bank (AfDB) Group, made a striking point: people do not eat GDP. His argument was anchored on the crucial need to enhance productivity within Africa's economies as a vital component for growth. Although current growth rate, averaging 3.7pc, is impressive compared to other regions, it is insufficient to drive structural transformation. The President noted the structural constraints on energy and agriculture as vital areas requiring investments. The 'African Economic Outlook report' for 2024 launched last week, discovered that despite a series of overlapping exogenous shocks, including the prolonged impacts of geopolitical tensions, climate change, and internal conflicts, African economies “displayed a remarkable ability to sustain growth,” albeit at a decelerated pace. However, projections for 2024-25 are optimistic. Expected growth rates will rise to 4.3pc in 2025, driven by improved global economic conditions and policy implementations across the continent. Close to 41 countries, including Ethiopia, are anticipated to exhibit higher growth rates this year than last year, and 15 are expected to exceed five percent growth. However, the report finds the pace of structural transformation remains uneven and slow, with traditional sectors such as agriculture still dominating employment despite lower productivity levels than other sectors. The agricultural sector, employing 42pc of Africa's workforce, remains significantly less productive, demanding targeted policy interventions to enhance productivity and drive sustainable economic development, the report stated. "Africa needs consistent growth of seven to 10pc annually for about 40 years to break the cycle of poverty," Akinwumi said.
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