African Economic Outlook 2007

1AU/EU Joint Summit

Lisbon 8th December 2007

African Economic Outlook 2007

Measuring the Pulse of Africa

Louis Kasekende Chief Economist, African Development Bank

Javier SantisoChief Development Economist, OECD Development

Centre

8 December 2007 Africa EU Summit

2AU/EU Joint Summit


The African Economic Outlook Project11

AfricaAfrica’s’s Economic Performance Economic Performance 06/07 06/07: Multifaceted Growth: Multifaceted Growth22

Measuring The Pulse of AfricaMeasuring The Pulse of Africa33

3AU/EU Joint Summit


Main Financial Partner

Junior partners

Lead partner

Consultants, think tanks …

Experts Network

AEOAEO Africa, EU, OECD: a unique partnership

UNECA

4AU/EU Joint Summit


AEOAEO An innovative product

• Comprehensive, independent analysis

• Short-term macroeconomic forecasts

• Special annual focus

2003: Privatization2004: Energy2005: SMEs2006: Transport2007: Water and sanitation2008: Technical & vocational training

1. Overview & annual thematic focus

2. Comparable country chapters

3. Statistical annex and indicators

5AU/EU Joint Summit


Algeria

Libya Egypt

Mauritania

Mali

Niger

Chad

Dem.Rep. Congo

Sudan

Central AfricanRepublic

Equatorial Guinea

GabonCongo

Cameroon

Angola

Guinea-BissauGuinea

Sierra Leone

Liberia

Côted'Ivoire

Tunisia

BurkinaFaso

Ghana

Nigeria

Togo

Ethiopia

Somalia

Djibouti

Eritrea

Kenya

Tanzania

Mozambique

SouthAfrica

Botswana

Zimbabwe

Namibia

Zambia

Swaziland

Lesotho

Malawi

Uganda

Burundi

Rwanda

Madagascar

Senegal

Gambia

Morocco

AEO 2007

Sao Tome et principe

Mauritius

Comores

Cape verde

Benin

New in 2008:

Cape Verde

Liberia

Libya

Equatorial Guinea

AEOAEO Coverage 2007: 31 African countries

91% of GDP

86% of population

6AU/EU Joint Summit


TThe African Economic Outlook Projecthe African Economic Outlook Project11

Africa’s Economic Performance 06/07: Multifaceted Growth22

Measuring The Pulse of AfricaMeasuring The Pulse of Africa33

7AU/EU Joint Summit


GrowthGrowth Africa continues steady growth

Growth is becoming more broad-based:•23 countries achieved GDP growth rate of above 5 % in 2006

•15 countries achieved GDP growth rate between 3% to 5% in 2006

In 2006, real GDP growth exceeded 5% for the third consecutive year

Total OECD

Africa

Source: AfDB/OECD

8AU/EU Joint Summit


GrowthGrowth The commodity boom: a key role

Global commodity prices 2001-2007

Source: World Bank

9AU/EU Joint Summit


GrowthGrowth Vibrant and Stable in oil-producing countries

26.9 %

Source: AfDB/OECD

Source: AfDB/OECD

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GrowthGrowth Gaining momentum in oil-importing countries

(%)

Source: AfDB/OECD



GrowthGrowth The rewards of economic reform

Public finance management is generally good and improving

Greater macroeconomic stability attained :•Fiscal balance is positive•Inflation is stable

Africa: inflation and fiscal balance(2000-2006)

Source: AfDB



GrowthGrowth Improved economic management

Source: AfDB



GovernanceGovernance Fewer bullets, more ballots

Presidential elections

in 2006

Benin

Cape Verde*

Chad

DRC*

Gambia

Madagascar

Sao Tome et Principe*

Seychelles

Zambia*

Uganda

*Parliamentary elections also*Weighted sum of

events



GovernanceGovernance MDGs: slow progress despite growth



AidAid Over the « hump » of debt relief

Source: OECD



AidAid

… but aid is still falling short of Gleneagles commitments of doubling assistance to Africa by 2010

… there is little new aid beyond debt relief and humanitarian aid

ODA & debt relief have helped stimulate growth



OutlookOutlook Oil exporter & importers: divergent paths?

Oil and Mineral exportersChallenges:

• Capitalise on windfall gains• Maximise spillover to rest of the

economy• Avoid Dutch Disease

Trade Balance Inflation

Growth Fiscal Balance

Oil importersChallenges:

• Contain inflationary pressure• Finance widening trade deficit• Streamline spending to prioritise

poverty reduction

Source: AfDB/OECD



TThe African Economic Outlook Projecthe African Economic Outlook Project11

AfricaAfrica’s’s Economic Performance Economic Performance 06/07 06/07: Multifaceted Growth: Multifaceted Growth22

Measuring The Pulse of Africa33



AEOAEO An African / European partnership

A Maturing Relationship

• An EU/OECD initiative with the African Development Bank

• Combining OECD approach (best practice, peer review) and AfDB regional expertise

• 2008: AfDB takes over as lead partner

A tool for business, finance & policy actors

• Expanding country coverage

• Improved modelling, forecasts & indicators

• Feeding into the policy-making process

• Supporting operational activities

• Increased co-operation with local institutions



20

Comparative, up-to-date and forward-looking tool

Monitoring progress towards MDGs of African countries: 31 countries in 2007 and 35 in 2008!

Analysing crucial themes for Africa development

Previous years: privatisation, energy, SME financing, transport, water

AEO 2008: “Technical Skills Development in Africa”

Deeply rooted in African realities

Network of local experts, constant dialogue with stakeholders

Quality peer review involving AfDB country and sector economists

Sound Statistical analysis and data computation

Original indicators (political troubles, diversification) and macro forecasts

New background research:Working papers on political indicators, privatisation, etc.

AEOAEO An indispensable tool



AEOAEO A strong African voice in policy dialogue

Promoting public debate on economic policies

• At national level (African policy makers)

• At regional and continental level (input for African Peer Review Mechanism)

• Building indicators tracking main APRM areas of focus

• Promoting best practice and lessons learned through experience

Supporting the International Dialogue on Africa’s Development

• Monitoring capacity-building in infrastructure, trade, institutions

• Monitoring policy reforms, financial flows for development

Millennium Development Goals

• Monitoring progress in 31 countries in 2007, 35 in 2008

• AEO, a joint AfDB/OECD/UNECA contribution to Goal 8



AEOAEO Net Progression in Media Impact

Citations in mainstream media

Source: OECD



AEOAEO Practical involvement in policy outcomes

Water• Inefficiencies not in resources, but in management

Transport Infrastructure • Reverse neglect through strategic PPP projects drawing on exterior

funding

Energy • Coordination of regional energy investment structures

SME financing • Facilitation of SME-business friendly environments

The AEO contributes to the issues debated at today’s EU-Africa Summit



AEOAEO Questions for the Summit

• How can the African Economic Outlook help develop African economies?

• How can the AEO contribute to reinforce the co-operation between Africa and Europe?

• How can African input more effectively into the AEO process?



Thank you

Obrigado

More information:www.oecd.org/dev/aeo

African Economic Outlook 2007

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