Africa is bestowed with young, fast-growing population. This population has been credited with the current economic boom all over the continent. We have compiled a list of six countries in sub-Saharan Africa with the highest projected compounded annual growth rate (CAGR). The data comes from World Bank’s Global Economic Prospects (G.E.P).
Growth in Sub-Saharan Africa is projected to slow to 4.2 percent on average in 2015 from 4.6 percent in 2014. This is a downward revision of 0.5 percentage points relative to January 2015 GEP. Growth will then pick up in the coming year to an average of 4.6 percent. An increase to 5.0 percent is expected to be witnessed in 2017. This growth increase will be fuelled by domestic demand, continuing infrastructure investment and private consumption driven by lower oil prices.
Bear in mind that these economies are not the largest or most developed ones. Some of them are actually plagued with low levels of per capita gross domestic product, high income inequality, political instability and run-away corruption. Here’s a look at Africa’s fastest growing economies:
It is mostly a rural country where 90 percent of the population depend on subsistence agriculture and some mineral and agro-processing. Tourism, minerals, coffee and tea are the main sources of foreign exchange. The 1994 genocide severely damaged the fragile economy. However, Rwanda has made substantial progress in stabilizing the economy to and further than pre-1994 levels.
GEP projection for Rwanda: 2015 GDP +7.00% / 2016 GDP +7.00% / 2017 GDP +7.50%
2014-2017 GDP CAGR +7.12%
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The conduct of the recent general elections in Tanzania has gone on to keep strengthening the investor confidence The country has largely completed its transition to a market economy though the government retains a presence in sectors such as telecoms, banking, energy and mining.. It has recently experienced high growth rates owing to gold production and tourism. The economy is also strengthened by telecommunications, banking, energy, mining and agriculture. Agriculture still accounts for more than one-quarter of GDP and provides 85 percent of exports and employs 80 percent of the country’s workforce.
GEP projection for Tanzania: 2015 GDP: +7.20% / 2016 GDP: +7.10% / 2017 GDP: +7.10%
2014-2017 GDP CAGR: +7.15%
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Mozambique has attracted large investment projects in natural resources translating to continuation of the country’s high growth rates. Mozambique grew an average annual rate of 6-8 percent in the decade up to 2014. One of Africa’s strongest performances. It is a country rich in natural resources. Revenues from these vast resources, including natural gas, coal, titanium and hydroelectric production could overtake donor assistance within five years.
GEP projection for Mozambique: 2015 GDP: +7.20% / 2016 GDP: +7.30% / 2017 GDP: +7.30%
2014-2017 GDP CAGR: +7.30%
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3. COTE D’IVOIRE
It is a country highly dependent on agriculture. Agricultural activities engage roughly two-thirds of the population. It is the world’s largest exporter of cocoa beans. The economy is highly sensitive to fluctuations in international prices and climatic changes. The end of a more than a decade of civil conflict in 2011 introduced a new era of a boom in foreign investment and economic growth.
GEP projection for Côte d’Ivoire: 2015 GDP: +8.00% / 2016 GDP: +7.70% / 2017 GDP: +7.50%
2014-2017 GDP CAGR: +7.80
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2. DEMOCRATIC REPUBLIC OF CONGO (DRC)
DRC is abundant is natural resources, however, it fails to achieve the economic potential presented by this due to corruption, conflict and political instability. Despite the hurdles it continues to grow. Renewed activity in the mining sector which is the source of most export income has boosted DRC’s GDP growth in recent years.
GEP projection for DRC: 2015 GDP: +8.00% / 2016 GDP: +8.50% / 2017 GDP: +9.00%|
2014-2017 GDP CAGR: +8.62%
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Coffee is the major export crop in an economy largely based on agriculture. The government is putting a major effort in diversification to manufacturing, textiles and energy generation. It issued its first sovereign bond in 2014 generating $1 billion revenue for a 10 year note. The only downside is that per capita income remains one of the lowest in the world despite the continuous high GDP growth.
GEP projection for Ethiopia: 2015 GDP: +9.50% / 2016 GDP: +10.50% / 2017 GDP: +8.50%
2014-2017 GDP CAGR: +9.70%
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*Source – Global Economic Prospects by World Bank