Oil prices pose downward risk
ALAN PEAT
THE GLOBAL economy has hit its highest growth rate in three decades, according to the September edition of the International Monetary Fund’s (IMF’s) twice-yearly World Economic Outlook.
The fund has upped its latest growth projection to 5% from the 4.4% level it attained in the April edition of the study.
However, according to Standard Bank economics researcher, Isaac Matshego, the persistently high global oil price poses a downward risk to this scenario
- and is probably a main factor in the IMF reducing its projection to 4.3% growth in 2005.
“But Africa’s economy will also grow strongly this year,” he told FTW, “and record an even higher growth rate in 2005.”
The IMF report forecasts that the sub-Saharan economy will expand by 4.6% this year - compared to the April expectation of 4.2%. The rate is expected to accelerate to 5.8% in 2005 - again the highest level in 30 years.
In SA, meantime, the share of this growth feast is expected to be maintained at the 2.6% level forecast in April. The projection for 2005, however, is upped to 3.3% from the April prediction of 2.2% for
the year.
