Stress-Testing Africa's Recent Growth and Poverty Performance

29 Pages Posted: 20 Apr 2016

See all articles by Shantayanan Devarajan

Shantayanan Devarajan

World Bank Middle East and North Africa Region

Delfin S. Go

Development Prospects Group, The World Bank

Maryla Maliszewska

World Bank

Israel Osorio-Rodarte

World Bank

Hans Timmer

World Bank

Date Written: June 1, 2013

Abstract

After an impressive acceleration in growth and poverty reduction since the mid-1990s, many African countries continue to register robust growth in the aftermath of the global financial crisis. Will this growth persist, given the tepid recovery in developed countries, numerous weather shocks, and civil conflicts in Africa? This paper "stress tests" African economies. The findings indicate that Africa's long-term growth is fairly impervious to a prolonged recession in high-income countries. Growth is, however, much more sensitive to a disruption of capital flows to the region, and to internal shocks, such as civil conflict and drought, even if the latter follow historical patterns. The broad policy implication is that with proper domestic production conditions African countries can sustain robust long-term growth. Because of the economic dominance of the agriculture sector and the share of food in household budgets, countries will need to increase the resilience of agriculture and protect it from unfavorable climate change impacts, such as drought. As in the past, civil conflicts and violence will pose by far the greatest threat to Africa's performance.

Keywords: Economic Theory & Research, Emerging Markets, Rural Poverty Reduction, Achieving Shared Growth, Climate Change Economics

Suggested Citation

Devarajan, Shantayanan and Go, Delfin S. and Maliszewska, Maryla and Osorio-Rodarte, Israel and Timmer, Hans, Stress-Testing Africa's Recent Growth and Poverty Performance (June 1, 2013). World Bank Policy Research Working Paper No. 6517. Available at SSRN: https://ssrn.com/abstract=2286556

Shantayanan Devarajan (Contact Author)

World Bank Middle East and North Africa Region ( email )

1818 H Street, NW
Washington, DC 20433
United States

Delfin S. Go

Development Prospects Group, The World Bank ( email )

1818 H Street
Washington, DC 20433
United States

Maryla Maliszewska

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Israel Osorio-Rodarte

World Bank ( email )

1818 H Street, NW
Washington, DC 20433
United States

Hans Timmer

World Bank ( email )

1818 H Street, N.W.
Washington, DC 20433
United States

HOME PAGE: http://econ.worldbank.org/staff/htimmer

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