The East Africa Community (EAC) is the fastest growing bloc in Africa thanks to its close traditional relations with China which is being described economically as the global ‘pole for stability.’
Chief Economist with the Standard Bank Group, Mr Goolam Ballim
Economists sharing their perspectives on the global economy in Dar es Salaam yesterday, said the growth of China coupled with the recent rising of the US economy will have direct effect to growth in Europe which will lead to an increase of trade with Africa.
They said China’s surging demand for natural resources and its new policy for reducing exports while creating domestic demand for its industrial goods is good for EAC growth.
The Chief Economist with the Standard Bank Group, Mr Goolam Ballim said China GDP growth slowed down in the last seven quarters to increase by around 7.0 per cent each quarter, expects to grow between 7.5 and 8.0 per cent per quarter beginning this year.
He was speaking during the Tanzania Economic Forum in the city organised by Stanbic Bank. The Chief Economist urges that the world economy was expected to grow by 3.3 per cent in this year slightly up by 0.1 per cent from last year.
“Africa economy expects to grow by 5.4 per cent, higher than the world average,” he said adding “Euro is not a place of encouragement” as the zone is not yet out of the financial crisis yet and project to grow at stagnant level. On US growth, data shows that the economy expected to grow by 2.0 per cent while last year it has created 200,000 extra jobs a sign shows that the large economy was on track to prosperity once again.
“China growth is also pushed up US consumer confidence index, which is on the increase,” Mr Ballim said. On average the EAC economy expects to grow by 7.0 per cent which was on higher side compared to the continent 5.4 per cent and is fast overtaking the western Africa growth.
On Tanzania growth, Stanbic Bank Regional Head – Macroeconomic Research, Mr Phumelele Mbiyo said looking on the trend, the economy was set to grow further as policy makers are keen to stick to macroeconomic fundamentals. The IMF on Tuesday forecast economic growth of 5.4 per cent in 2013 and 5.7 per cent in 2014 for the economies of sub-Saharan Africa on the back of rising investment and booming extractive industries.
“Sub-Saharan Africa will be among the fastest growing places in the world … second only to developing Asia,” Antoinette Sayeh, director of the IMF’s Africa department, told journalists in Ghana’s capital Accra.
In April, the IMF forecast sub-Saharan Africa’s growth at 5.6 per cent this year and 6.1 per cent in 2014 in its World Economic Outlook. The small discrepancy with the latest figures was because they stripped out volatile South Sudan, the IMF said.
By ABDUEL ELINAZA, Tanzania Daily News
