Africa's growth raises UN optimism

The growth rate was faster than in any other developing region in the world, thanks to strong agricultural output, proper economic management and an end to conflicts in many countries, the UN Economic Commission for Africa (UNECA) report said.

Consequently, poverty was reduced as the number of countries with growth rates higher than 3% rose to 37 in 2001 from 26 in 2000.

But not all African countries performed well, and even where they did the growth remained fragile, the report said.

Tough targets

Average income per person rose 1.9% in 2001.

This was an improvement, but not enough to reach the UN's millennium development goal of halving poverty in Africa by 2015, the report said.

The overall growth rate of 4% was also to slow to meet UN targets, according to the report which was distributed at the launch of the African Union (AU) in Durban, South Africa.

But there were also a few reasons for "cautious optimism" about Africa's medium-term prospects, namely:

• The US African Growth and Opportunity Act (AGOA)
• The European Union's "Everything but Arms" initiative
• The New Partnership for African Development (Nepad)
• The Doha Development round
• The African Union

"Ultimately, though, Africa's future depends on how it addresses economic and political governance, resolves civil conflicts, and responds to the need for deeper economic and social reforms," UNECA said.

Investment, trade and aid

The report highlighted some of the developments of 2001:

• Economic growth rose to 4% from 3.5% in 2000
• Africa's emerging markets enjoyed a sharp rise in investment from abroad
• Foreign investors increasingly judge each country on its own merits
• The main beneficiaries of the inward investment rise were Algeria, Egypt, Morocco, South Africa and Tunisia
• Egypt, Morocco and Tunisia account for a quarter of Africa's gross domestic product
• Trade within Africa remained fragmented: An average African country conducted 92% of its trade with non-African countries
• Africa's share of global foreign investment fell from 25% in the early 1970s to about 5%
• Most donors halved their donations during the 1990s
• Aid from Arab countries increased

The report said African nations should concentrate on improving governance, public finances and the environment for producers, investors and employers.

Instead, many countries focused on cutting debts and inflation, realigning their exchange rates and making government spending more transparent.