20091208

Africa's gross domestic product is likely to grow by between 5.5 and 6 percent in 2010 as the continent recovers from the global downturn, Donald Kaberuka, the president of the African Development Bank (AfDB), said on Monday.
Donald Kaberuka also said the bank had suspended programmes in Guinea, including a mining project involving Rio Tinto, because of instability in the country, where a ruling military junta is facing international sanctions.

In an interview at the AfDB's headquarters in the Tunisian capital, Kaberuka said he was upbeat about the economic outlook for Africa after a year when the continent was hit hard by a drop in demand for commodities and scarcity of finance.

He said the bank had revised up its GDP growth forecast for 2009 to around 4 percent from the previous 3.5 percent, and that it expected to reduce lending in 2010 and would wind down some of its crisis-response instruments.

"I am much more optimistic for 2010 than I was a year ago," Kaberuka told Reuters. "For an average next year we shall see 5-1/2 percent, 6 percent (GDP growth)," he said.

Asked about GDP growth for 2009 he said: "We are at around 4 percent ... a figure of 4, 4.5 percent is not improbable."

He said the bank's lending in 2009, which rose to about $10 billion in response to the slump, was probably a peak. "I expect that ... we will go back to our traditional expected lending area of around $7 billion.

"Depending on what happens, we intend to scale down some of our crisis response instruments," Kaberuka said.

He said Africa's economic recovery would be driven by reviving demand for commodity exports and a pick-up in investment flows, which dried up in the global slump.

South Africa, Kenya and Nigeria would play a key role because they would drive growth in their regions.

"I am very much encouraged by the performance of the South African economy so far, which is recovering quite well from where it was a few months ago," he said.

africagoodnews