Africa is feeling the pain of slow reform
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Without ‘drastic actions’ to boost growth, Africa will be home to 90% of people living in poverty globally by 2030. This is the sombre conclusion of the World Bank’s latest regional outlook, in which it also cuts the continent’s growth forecast from 2.8% to 2.6%.
Uncertainty in the global economy is accentuating the effects of slow reform, according to the Bank. Combined with the halving of average growth from around 5% before the commodity price slump, to 2.5% between 2015-2019, the prospects for poverty reduction are looking grim.
On current trends, the Bank warns, poverty ‘will soon become a predominantly African phenomenon’.
It’s a striking, and predictable conclusion.
For at least a decade there have been warnings that a general lack of structural economic reform has seen GDP growth have – at best – limited impact on poverty levels. In absolute terms, the number of poor people in sub-Saharan Africa actually increased from 278 million in 1998 to 416.4 million in 2015.
Even if governments suddenly got serious about reform the odds of a change in trajectory are diminishing against a backdrop of fiscal tightening and soaring debt, further constraining their ability to tackle poverty.
With global economic uncertainty and sluggish growth looking like they’re here to stay, the price of slow reform is becoming painfully obvious.
This report reflects the views of the author alone, not those of How we made it in Africa.
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