Sub-Saharan Africa continues to attract investors
The World Bank has recently compiled a Global Economic prospects report in which they have detailed which countries have the highest projected gross national product (GDP) compounded annual growth rate (CAGR).
Whilst the overall growth in Sub-Saharan Africa is still projected to slow in coming months, a number of countries in the region are expected to see growth as a result of fast growing young populations and the continued commitment to investment in their infrastructure by local and international investors.
Sub-Saharan’s six fastest growing economies
According to the recent report compiled by the World Bank; Rwanda, Tanzania, Mozambique, Cote d’Ivoire, Democratic Republic of Congo and Ethiopia are the fastest growing economies in the region at this time. They are however in no way the largest or most successful economies in Africa, in fact some of them suffer from a range of serious challenges, including poverty, political instability and corruption.
6. Rwanda 2014-2017 GDP CAGR: +7.12%
The genocide in 1994 seriously damaged the economy and whilst over 90% of the population still rely on subsistence farming or mineral processing to survive, they have made great progress over recent years, resulting in significant levels of economic growth.
5. Tanzania 2014-2017 GDP CAGR: +7.15%
Investor confidence continues to grow following the recent general election, and whilst the government still controls a number of key sectors, such as telecoms, mining, energy and banking, most now consider Tanzania to have a market economy. Growth is currently being driven by both tourism and gold production and whilst agriculture still makes up over 25% of the GDP, provides employment for over 80% of the working population and accounts for 85% of the country’s exports, growth in areas such as banking, mining, telecommunications and energy are driving the economy.
4. Mozambique 2014-2017 GDP CAGR: +7.30%
Their vast natural resources continue to attract significant investments making their growth rate one of the highest in Africa over recent years. It is expected that this growth will continue as their hydroelectric production in still increasing and their deposits of titanium, natural gas and coal continue to be substantial.
3. Cote d’Ivoire 2014-2017 GDP CAGR: +7.80
As the largest exporter of cocoa beans in the world, Cote d’Ivoire economy is hugely affected by fluctuating commodity prices and production levels. They are however continuing to attract high levels of foreign investment, as they have been since the end of the civil war in 2011. These investments are helping to make Cote d’Ivoire one of the fastest growing economies in Africa.
2. Democratic Republic of Congo (DRC) 2014-2017 GDP CAGR: +8.62%
DRC is another country in Africa with very significant natural resources however high levels of corruption, in addition to continuing political instability are suppressing their growth potential. The mining sector is however continuing to grow, helping to drive up their GDP.
1. Ethiopia 2014-2017 GDP CAGR: +9.70%
As a major exporter of coffee, agriculture is key to their continued GDP growth. Manufacturing and energy generators are two of the sectors currently receiving investment from the government, part of the move to become less reliant on their agricultural sector. The biggest challenge faced by the Ethiopian government is to improve the per capita income as despite all their successes, it continues to be one of the lowest in the world.