Africa's economy stumbles

US tourists have cancelled safaris, harming the economy

Africa's economic growth is being hit as the global economic slowdown impacts on both aid and foreign direct investment in the region.

And the president of the African Development Bank (AfDB) has said the combination of the 11 September terrorist attacks and the economic fallout will be 'devastating' for Africa.

2002 projected growth in Sub-Saharan Africa

Zimbabwe -5.0%

Gabon -0.6%

Liberia +1.0%

Kenya 2.5%

South Africa 2.9%

Source: EIU

The African Development Bank predicts that current economic growth in Africa is barely 3-3.5% - no more than the continent's rate of population growth.

In other words, said AfDB President Omar Kabbaj, "We are not growing at all in real terms."

Gross Domestic Product - the broadest economic indicator growth - is usually much higher in countries with rapid population growth.

Before the onset of the global economic slowdown, the AfDB's had forecast a growth rate of 4-5% for 2002 and 2003.

"The external effects have always been very important but this time they are devastating," Mr Kabbaj said.

International organisations have previously said that growth rates of around 7% across Africa are needed in order reduce the region's poverty by half.

Winners and losers

But the outlook for Africa's different countries varies greatly.

While many countries are suffering from the economic slump, sub-Saharan Africa also boasts the fastest growing economy in the world.

Fastest % growth in Sub-Saharan Africa

Equatorial Guinea 34%

Angola 10.3%

Chad 10%

Mozambique 9.5%

Ethiopia 6.8%

Burkina Faso 6%

Mali 6%

Senegal 5.9%

Source: EIU

According to the Economist Intelligence Unit (EIU), Equatorial Guinea's economy will rocket 34% next year.

And eight out of 20 of the world's fastest-growing countries are in Africa.

But the continent is also home to the country which is expected to show the sharpest decline in the world.

Zimbabwe is expected to suffer a 5% decline in GDP, and its political and economic turmoil - especially in the runup to a hotly contested presidential election in March 2002 - is impacting on its neighbours, especially South Africa.

Tourism trouble

Somalia is though to be one of the biggest losers in the fallout from the post-September attacks.

It has been singled out by Washington as a possible haven for Osama bin Laden's terrorist network and is also facing a drought, a ban on livestock exports and runaway inflation.

Many oil producing countries - especially Nigeria and Angola - are suffering from the slump in oil demand and prices as a result of the slowing global economy.

And tourism - especially in countries like Kenya which traditionally welcome a lot of US citizens - has also declined sharply, further harming the economy.

US tourist arrivals to Kenya halved last month compared to November last year, while European tourists were down 30%.