ECONOMY: Region (MRB Nov 2001): World Bank and IMF sum up.

The economic slowdown in the industrialised world has hit sub-Saharan Africa hard, according to the World Bank. It estimates that growth in SSA slowed to 2.7 percent in 2001 from 3 percent in 2000, interrupting a progressive recovery from the slowdown of the late 1990s. With population growing at 2.4 percent, the rise in per capita GDP was minimal. The slowdown was widespread throughout the region, in East, West, and Southern Africa, and in both oil and non-oil commodity exporters.

In the face of weaker demand from the US and the Euro Area, merchandise exports managed just 3.4 percent growth in volume terms compared to 8.8 percent in 2000. Services exports, including tourism, were also affected, growing by 3.6 percent. Commodity prices remained well below levels of the late 1990s, including those that rebounded from recent lows. Beverage producers were particularly hard hit, with coffee prices down over 25 percent from 2000 and cocoa prices-although they were up around 10 percent in 2001 - only 75 percent of the average for 1995-2000.

While oil prices eased back from their peak of nearly $30 a barrel in mid-2000 they remained strong, and oil exporters outperformed the region as a whole, growing at an average of 3.6 percent for the year, compared to 2.6 percent for non-oil exporters. Oil constitutes less than a third of SSA exports, however, and net energy exports are only 5 percent of GDP. Thus on balance, recent world commodity market trends represented a major drag on growth and incomes.

Apart from the external environment, developments within the region painted a mixed picture. ...