Report: Africa’s Remittance Income Is Key Economic Booster

The third quarter 2018 report of the Institute of Chartered Accountants in England and Wales (ICAEW), produced by partner and forecaster, Oxford Economics, which focused on the African region economic performance, revealed that Africa projected a positive economic outlook, with remittance income expected to be a key economic booster in the coming months.

According to the report, which surveyed regions like East Africa, West and Central Africa, Northern Africa, Franc zone and Southern Africa, the East Africa continued to be the continent’s best performing region with a GDP forecast at 6.3 per cent. The positive outlook is due to the region’s economic diversification and investment-driven growth. Ethiopia remains the region’s powerhouse, with growth forecast at 8.1 per cent, which was attributed to the recent reforms under the new Prime Minister, Abiy Ahmed.

In Central and West Africa, the report puts the growth forecast at 2.9 per cent, while blaming the constrained growth in the regions, to subdued non-oil economic activity by Nigeria, the West Africa region’s powerhouse.

Ghana by contrast was described as the best performing country in the West African region with a forecast growth of 6.5 per cent.

Regional Director, ICAEW, in charge of Middle East, Africa and South Asia, Mr. Michael Armstrong, said: “Despite the recent growth slump; all regions in Africa are projected to report a positive economic outlook, with remittance income expected to be a key economic booster in the coming months.”

Growth in the francophone zone is forecast at 4.6 per cent, largely driven by a boost of 7.4 per cent in the region’s biggest economy, Ivory Coast, where investment is driving rapid expansion.

North Africa’s Egypt is forecast at 5.3 per cent, as a result of structural and policy reforms, which have boosted manufacturing and investment. The county’s tourism sector has also continued to recover.