The region’s ‘good news story’

Ethiopia is set to be the fastest-growing economy in Africa, averaging growth of 8.2% for the next six years. This is according to Celeste Fauconnier, RMB Africa analyst and co-author of ‘Where to Invest in Africa’. She said the country had been extremely successful at nurturing comparative advantage – especially in the agriculture and manufacturing sectors. “Also, with almost 100 million people, the demand for goods and services has

been rising significantly.” Fauconnier told FTW that it was not just Ethiopia but the entire East African region that would see high growth rates in the next decade. “It used to be southern Africa which was then overtaken by West Africa. Now the good news story on the continent is undoubtedly East Africa.” Whilst much of the growth could be attributed

to oil and gas being found in the region, Fauconnier said what made the East African story so much more positive was that unlike the rest of Africa they were not dependent on resources. “In East Africa, we are expecting to see far more diversification than what has been the case in West or southern Africa,” she said. With production of much of the oil and gas finds only

expected to come on line around 2023, Fauconnier said significant investment would be made into the region between now and then. “Already the East African standard railway line is being jacked up and there is a lot of focus on port development.” According to Fauconnier the growth rate in Kenya is expected to accelerate in the next year due to the lifting of the cap on the lending rates in the country. “With the cap having been found unconstitutional and set to be phased out over the next year we expect to see 1 to 1.5 percentage points added

just because it has been removed.” Expected GDP for the country is currently above 5%. Tanzania, said Fauconnier, despite being carefully monitored due to the shenanigans of its president, had an expected growth rate of above 6.5% over the next five years. Another East African country that continued to perform was Rwanda. “It is still one of Africa’s five fastest-growing economies with the secondbest business environment on the continent. It has more than doubled the efficiency of its business environment in less than a decade.” In East Africa, we are expecting to see far more diversification than in West or southern Africa. – Celeste Fauconnier