Is Africa's Recent Growth Robust?

Abstract:     
Sub-Saharan Africa has grown at record figures since the mid-1990s, generating optimism that the continent has finally turned the corner on the path to sustained growth. But growth has been largely driven by high international demand for commodities in general, and hydrocarbons and other minerals in particular, and it is unclear how the region will cope if and when the global demand for raw materials slows down. To answer this question we first investigate whether growth has accelerated since 1995, and second whether the economic fundamentals that drive long run growth have improved during the acceleration. We use the methodology developed by Arbache and Page (2007a) and find evidence that Africa has indeed been experiencing record growth acceleration since 1995. But we find that in general growth accelerations have not been accompanied by improved economic fundamentals such as investment rates, current accounts, fiscal accounts, and inflation, thus suggesting that so far there is little indication that the region is experiencing a robust growth period.

Keywords: growth robustness, economic fundamentals, Sub-Saharan Africa

JEL Classifications: O11, O55

Working Paper Series