KENYA: Sub-Saharan African economies are expected to post nearly 6 percent average economic growth in 2012, rising from above 5 percent on average this year, according to the International Monetary Fund

Record ID: 360775

  • Title: KENYA: Sub-Saharan African economies are expected to post nearly 6 percent average economic growth in 2012, rising from above 5 percent on average this year, according to the International Monetary Fund
  • Date: 19th October 2011
  • Summary: JUBA, SOUTH SUDAN (FILE) (REUTERS) VARIOUS OF MAN AT BANK COUNTER BEING HANDED MONEY MAN COUNTING BANK NOTES
  • Embargoed: 3rd November 2011 12:00
  • Keywords:
  • Location: Kenya, Kenya
  • Country: Kenya
  • Topics: Economy
  • Reuters ID: LVA9WCGU75C7DRYA3UNRMLJ4KZGG
  • Story Text: The International Monetary Fund (IMF) forecast on Wednesday (October 19) a rosy outlook for Sub Saharan Africa growth in 2012 but warned of significant risks from global financial volatility that could subdue demand and private inflows into the world's poorest continent.
    Economies in the region are expected to post nearly 6 percent average economic growth in 2012, rising from above 5 percent this year, the IMF said, pointing to a better outlook than in advanced economies, which could experience a sharp slowdown due to global volatility.
    "We're still quite positive that Africa can sustain its growth that it's seen in the last decade or more but there are certainly urgent actions individual governments need to take to be able to make sure they're on that sustained path. But I think Africa's prospects are still very positive," said Antoinette Sayeh, director of the IMF's African department.
    Speaking at media conference in Nairobi, Sayeh urged policymakers in the continent to formulate policies that took into account the projected strong growth as well as emerging challenges from the global financial problems.
    She said inflation and the rapidly spiraling cost of living are in danger of damaging growth in several countries in Sub Saharan Africa.
    "We are concerned that inflationary pressure are taking hold in a number of East African countries and that needs to be dealt with urgently," she said.
    She added that policies need to tread a fine line between addressing the challenges posed by strong growth and preparing to ward off the potentially adverse effects of another global downturn.
    At the same time, Sub-Saharan Africa needs to continue to invest in growth and employment, which are critical for sustained poverty reduction.
    Sayeh warned countries could experience civil unrest of the kind seen in North Africa and the Arab world if certain key problems aren't addressed, particularly youth unemployment.
    "What we've seen in North Africa and other Arab countries has transpired because of a lack of progress in creating jobs for young people and that's certainly a factor also in some African countries," she said.
    Economies in the region are also reeling from high food and fuel prices, which have driven up inflation. Countries across the continent including Kenya, South Africa, Benin and Uganda have experienced popular protests recently at the rising cost of living.
    The IMF warned these could continue if governments don't take action to address some of the complaints.
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