African Economic Outlook 2013 launched in Ethiopia

29 Sep 2013

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“A number of African countries, including Ethiopia, have already discovered, or seem poised to discover, oil or mineral resources. But we know all too well that the mere presence of such resources does not guarantee positive transformation or human development. Natural resources can be both a curse and a blessing,” said Mr Eugene Owusu, Resident Representative of UNDP in Ethiopia at the launch of the African Economic Outlook 2013 in Addis Ababa on the 26th of October 2013.

This year’s report focuses on structural transformation and natural resources of Africa and it observes that the continent’s economic outlook for 2013 and 2014 is promising, confirming its healthy resilience to internal and external shocks and its role as a growth pole in an ailing global economy. Africa’s economy is projected to grow by 4.8 per cent in 2013 and accelerate further to 5.3 per cent in 2014.

The report shows this growth has been accompanied by insufficient poverty reduction, persisting unemployment, increased income inequalities and in some countries, deteriorating levels of health and education.  “Now is the time to step up the tempo of economic transformation, so that African economies become more competitive and create more gainful jobs”, say the authors of the report, adding that “widening the sources of economic activity is fundamental to meeting this challenge.”

The report argues that African countries must tap into their natural resource wealth to accelerate the pace of growth and ensure the process can benefit ordinary Africans. The synopsis of the country case studies shows that the African countries are differently endowed with natural resources but each country’s available resources provide a unique opportunity of fostering structural transformation.

Ethiopia has demonstrated impressive growth over the past decade, succeeded in decreasing poverty levels and achieved most of the Millennium Development Goals pointed out by His Excellency, Mr Ahmed Shide, the State Minister of the Ministry of Finance and Economic Development at the launch.

“Natural resources of a country should be harnessed to drive economic growth to change the lives’ of the citizens to the better,” said Mr Mekonnen Manyazewal, the National Planning Commissioner.

Ethiopia’s resource base is composed of its people and agriculture. The AEO 2013 report likewise observes that in Africa, and countries like Ethiopia, most poor people earn their livelihoods in the agriculture sector, highlighting the need for investment in agriculture and rural development in particular, while supporting economic diversification and investing in critical infrastructure. This can create jobs and add value through increasing land and labour productivity. This indicates that a move towards structural transformation should focus on raising agricultural productivity and boosting rural industrialization.

“If we invest in our growing young population, the bedrock of our own development and the most powerful instrument we have, we will see innovative ideas and creativity and ultimately growth as a result,” said Mr Mekonnen and continued “Our greatest resource is not gold or diamonds but our human resources.”

Ultimately, transformation means opening opportunities so people can find jobs, create businesses, as well as invest in health, education and food security. In turn, higher levels of human development for all, including the most vulnerable, can accelerate the pace of economic transformation, leading to a virtuous cycle of growth and development.

The African Economic Outlook 2013 is an annual report jointly published by the African Development Bank (AfDB), the United Nations Development Programme (UNDP), the United Nations Economic Commission for Africa (UNECA), and the Development Centre of the Organization for Economic Co-operation and Development (OECD). Since its inception, the key objectives of the African Economic Outlook have been to broaden the knowledge base on African economies and to offer a valuable and evidence-based support for policy-making, investment decisions and donor interventions.