OCTOBER 2010 | ISSUE 02 62866 An analysis of issues shaping Africa’s economic future Recent Economic Trends and Prospects for African Economies Country Policy & Institutional Assessment: Results and Trends for sub-Saharan Africa Advancing Toward the MDGs THE WORLD BANK This document was produced by the Office of the Chief Economist for the Africa region A F R I C A ’ S P U L S E T E A M : Punam Chuhan-Pole (Team Leader); Vijdan Korman; and Manka Angwafo. Before the global economic crisis, Sub-Saharan Africa was enjoying over a decade of policy improvements and strong growth, averaging more than 5 percent a year in 2000-08 Thanks to this policy-driven growth and improved service delivery, the region also saw an impressive acceleration in progress toward the Millennium Development Goals. Despite a decline in the payoff to economic reforms during the global crisis, African policymakers continued to implement sensible economic policies. Although Sub-Saharan Africa was hit hard by the crisis, growth has rebounded and the region is experiencing a broad-based recovery. The crisis has set back progress on the MDGs. But as the countdown to 2015 begins, the region is well positioned to ramp up momentum on achieving the MDGs. Global support is critical to attaining the goals. Section I: Recent economic trends and prospects The recovery in Sub-Saharan Africa is continuing apace. Several factors are fueling the recovery: counter-cyclical fiscal policies, up-tick in commodity prices and rebound in exports. Global outlook The global economic recovery is slowing on the 1. Global growth rates 2000-2012 back of a waning of the inventory cycle and a 10 winding down of government stimulus 8 programs. Preliminary updates to the World Bank’s forecast suggest global GDP growth of 6 3.5 percent in 2010, slowing to 3.3 percent in 4 2011 before recovering to 3.6 percent in 2012.1 With a growth rate of about 6.5 percent in 2010 2 and a little under 6 percent in 2011, developing countries are expected to continue to 0 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 outperform high income countries—which are -2 projected to grow at about 2.4 percent a year— by a wide margin. Excluding fast growing China -4 World High-income Middle-income Low-income Source: Development prospects Group, World Bank and India, developing countries’ growth is projected to be near 5.7 percent this year and World growth rates are projected to slow down in 2011. 5.2 percent in 2011. Excluding fast growing China and India, developing countries’ growth is projected to be near 5.7 percent this Global prospects continue to be clouded by a year and 5.2 percent in 2011. slowdown in growth—with even the possibility of a double-dip recession in the U.S. or Europe. Industrial production has slowed worldwide Further, lingering sovereign debt concerns in from 10.9 percent annualized gains in the first some European countries as well as planned quarter of 2010 to 9.4 percent in the second. fiscal austerity measures in Europe are adding The bounce back in global trade has come to an to this uncertainty. end as well, with growth in global merchandise trade values having decelerated from a high of 25 percent in the first quarter to just 2.5 percent in the three months ending July 2010. 1 Forecasts produced by the Development Prospects Group, World Bank. 1 Outlook for Sub-Saharan Africa The recovery in Sub-Saharan Africa is countries are growing at a much faster continuing apace. The region has shown pace than upper middle income countries. remarkable resilience in the face of a Overall, middle income countries, which global recession, and economic growth is are more integrated in global markets and projected to expand from 1.8 percent in which were hit harder by the crisis, are 2009 to 4.9 percent in 2010. Growth is rebounding strongly. At about 7 percent, likely to be sustained at about 5 percent the region’s group of oil-exporting in 2011 and 2012, below the pre-crisis countries is seeing higher growth rates trend rate. Among developing regions, than non-oil economies. On average, Sub-Saharan Africa’s growth rates will be however, both oil and non-oil economies the third fastest, ahead of the MENA, ECA are showing a rebound in growth to and LAC regions (Figure 2). sustainable levels. Fragile economies, which include several resource rich 2. Growth rates 2009-1011 countries including Angola and Sudan, are 10 growing briskly as well. 8 6 Prospects and performance by country groups (4 & 4 5) 10.0 2 0 8.0 -2 6.0 -4 2009 2010 2011 -6 4.0 LIC -8 2.0 East Asia Europe and Latin America Middle-East South Asia Sub-Saharan LMC Central Asia and North Africa Africa 0.0 UMC 3. GDP Growth in Sub-Saharan Africa -2.0 -4.0 2001 2003 2005 2007 2009 2011 10.0 9.0 8.0 7.0 6.0 5.0 4.0 NONOIL OIL Source: Development prospects Group, World Bank 3.0 Economic growth in Sub Saharan Africa is projected to expand from 1.8 percent in 2009 to 4.9 percent in 2010. Among 2.0 developing regions, Sub-Saharan Africa’s growth rates will be 1.0 the third fastest, ahead of Europe and Central Asia, Latin America, and the Middle East and North-Africa 0.0 2001 2003 2005 2007 2009 2011 While the recovery in economic activity is Source: Development prospects Group, World Bank broad-based, there is considerable While the recovery in economic activity is broad-based, there is considerable heterogeneity in the continent. On average, heterogeneity in Sub-Saharan African however, both oil and non-oil economies are showing a rebound countries’ growth performances. Low in growth to sustainable levels. income and lower middle income 2 Among sub-regions, East and West Africa 7. Commodity prices are leading the continent in growth. 500 Central Africa, the island economies, and Energy Southern Africa are seeing a slower pace 400 of expansion. 300 Base Metals 6. Sub-regional performance 200 Agriculture 100 Jan-04 Jan-05 Jan-06 Jan-07 Jan-08 Jan-09 Jan-10 7A. Merchandise export growth in Sub-Saharan Africa Source: Development prospects Group, World Bank Factors driving the region’s performance Several factors have helped to fuel the recovery in Sub-Saharan Africa. Source: Development prospects Group, World Bank Commodity prices, particularly energy Commodity prices, particularly energy and base metals have and base metals have boosted growth in boosted growth in resource rich countries of Sub-Saharan Africa. resource rich countries in the region. Overall, merchandise exports have rebounded in parallel with global trends, although exports remain below pre-crisis levels. Overall, merchandise exports in the region have rebounded in parallel with global trends, although exports remain Several countries implemented below pre-crisis levels. The boom in countercyclical fiscal policies in the wake export growth is moderating to more of the global financial crisis, which helped sustainable levels. Services trade, to support domestic output. African specifically tourism receipts have been on countries saw a widening of fiscal deficits the rise as well: Mauritius (8.5 percent up by about 6 percent of GDP in 2009, as in the second half of 2010), Seychelles (13 countries used fiscal policies to counter percent rise in the second half of 2010); the effect of the slowdown in economic Cape Verde, Kenya and Tanzania are also activity. Among low income countries, seeing higher tourism receipts. However, those with fiscal space ran modest fiscal the situation in Europe creates some deficits; some low income countries even uncertainty as a large share of tourist contracted their deficits. External and arrivals are from European countries. fiscal balances, which had widened in 2009, remain large. Strengthening of private consumption is also contributing to the recovery. 3 availability of financing, especially official 8. Current account balance and fiscal deficit in Sub- development assistance for poor Saharan Africa countries, could constrain these countries’ growth as well. Along with 2.0 global developments, domestic factors 1.0 such macroeconomic policies (including the timing and speed of withdrawal of annual percentage change (%) 0.0 95-05 2007 2008 2009 2010 fiscal and monetary stimulus), political (1.0) events (a large number of African (2.0) countries have upcoming general (3.0) elections), and weather conditions can (4.0) impact prospects. (5.0) Global food prices. The recent (6.0) Current account bal/GDP (%) Fiscal balance/GDP (%) disruption in the global wheat market was a reminder of the region’s Source: Development prospects Group, World Bank African countries saw a widening of fiscal deficits by about 6 vulnerability to food price shocks. After percent of GDP in 2009, as countries used fiscal policies to declining by 16 percent in the first half of counter the effect of the slowdown in economic activity. this year, global grain prices (World Bank’s grain price index) surged on the Foreign direct investment flows are also back of a sharp rise in wheat prices and fueling growth in the region. FDI flows knock-on effects on other key staple have increased in Sub-Saharan Africa in grains such as maize, rice, and sorghum. six out of the past ten years. Even in the Wheat prices rose by 56 percent between crisis years of 2008 and 2009, FDI June and August 2010. As demand for increased, by 22 and 16 percent, substitutes increased, prices of other respectively. Angola, Nigeria and South grains also firmed up: the price of rice and Africa accounted for a bulk of the maize was up 10 percent and 8 percent investment destination, nonetheless there respectively in August 2010. Current were significant flows to the natural global market conditions of grain supplies resource sectors of other resource rich are very different from those during the countries. This includes, a surge in FDI food price crisis of 2007-08, reducing the flows to Ghana (recent oil discovery); risk of an across-the-board acceleration of Mozambique (coal, gas, aluminum); Niger prices. Nevertheless, even modest shocks (Uranium); Zambia (copper); Uganda in global grain markets can impact (recent oil discovery); Liberia (iron ore); domestic markets and food security. and Guinea (iron ore). Remittance flows to the region have remained relatively Based on very partial data and lags in stable, despite the global crisis. These transmission of global movements to local flows measured $20.7 billion in 2009 and markets, the effect of the global increase $21.3 billion in 2008. in wheat prices on local markets in Africa appears to be limited. Higher wheat Risks to economic prospects prices in local markets are reported in Developments in the global economy such Kenya and Mozambique. In Mozambique, as weaker growth, particularly in a major wheat price increases along with price trading partner such as the European changes for petrol, water and electricity Union, pose a risk to the region’s growth led to unrest. These price increases were prospects. A disruption in grain markets rescinded. Mauritania, which imports also presents a downside risk. The 100 percent of wheat consumed, saw a 55 percent jump in wheat prices between 4 July and August 2010. However, the Along with global price movements, local country is maintaining its earlier fixed factors can affect local grain staple prices. price of bread. Aid is buffering the impact Food price volatility has increased since of global wheat price movements in other the food price crisis, and poor countries high wheat consumption countries such are particularly vulnerable. Rising food as Burundi, Cape Verde, Ethiopia, and prices impose a heavy burden on poor Zimbabwe. countries’ already high incidence of malnutrition and hunger. 5 Section II Country Policy and Institutional Assessment: Results and Trends for Sub-Saharan Africa The latest CPIA scores indicate that despite the impact of the global economic crisis, African policymakers continued to implement prudent policies and reforms. More than twice as many countries improved the quality of their policies and institutions than saw a decline. Countries with better policies and institutions have seen stronger growth. Africa region 2009 CPIA scores Box 1: What is the CPIA? The latest CPIA scores, assessing the The World Bank's Country Policy and Institutional quality of policies and institutions in Assessment (CPIA) captures the quality of a country's policies and institutions. It has evolved 2009, show that overall African into a set of 16 criteria that are grouped in four policymakers remained committed to clusters: (i) economic management; (ii) structural sensible policies and reforms, even in the policies; (iii) policies for social inclusion and face of an extremely challenging economic equity; and (iv) public sector management and institutions. Ratings for each of the criteria reflect environment. a variety of indicators, observations, and World Bank staff judgments. For each of the 16 criteria, Better policy performance in a countries are rated on a scale of 1 (low) to 6 (high). wide range of countries. The latest These scores are averaged within each cluster to produce the cluster score, and the overall score is results show a higher CPIA score for derived from the cluster scores. The scores nearly half of all IDA eligible African depend on the level of performance in a given year countries; with the number of gainers assessed against the criteria, and not on changes in outpacing decliners by more than 2 to 1 performance compared to the previous year. They depend on current policies and institutions, rather (the aggregate score for the region was than on promises or intentions. unchanged). What is remarkable about Source: CPIA Questionnaire 2009. the broad-based improvement in policies http://siteresources.worldbank.org/IDA/Resources/73153 -1181752621336/CPIA09CriteriaB.pdf is that it occurred in a difficult economic environment. African countries were grappling with back-to-back crises: the Performance of countries varies global financial crisis of 2008, which greatly. Although the potential CPIA followed on the heels of the food and fuel score can vary from 1 to 6, the CPIA prices crisis of 2007. There was a scores for the thirty-seven IDA-eligible concern that a decline in the payoff to countries in Africa tend to fall between economic reforms during the 2.4 and 4 (Figure 9). The average CPIA international economic crisis could result for IDA borrowers was 3.3 in 2009. Data in a reversal on reforms. But despite its from 2005-09 show that: severity, African policymakers generally (i) A few countries have consistently had did not backtrack on policy reforms strong policies, with average CPIA scores during the global crisis. Some countries clustered around 4.0: Cape Verde, Ghana, even accelerated reforms. This prudent Tanzania, and Uganda. These countries response means that the policy have either maintained or strengthened environment in Africa, which had been their policies in each of the last five years. improving until the crisis, continued to Typically, these countries have exhibited improve during the crisis. strength across the four policy clusters of the CPIA. (ii) A handful of countries, such as Zimbabwe, Eritrea, and Comoros, have 6 demonstrated weak policies and posted posted relatively high scores. Over the CPIA scores below 2.5 for the past five same period, Eritrea experienced a years. significant deterioration in its CPIA score. Zimbabwe saw a substantial decline in its 9. Average CPIA ranking 2005-09 CPIA score in 2005-08 as the country slipped into hyperinflation. But a CAPE VERDE subsequent liberalization of prices and 4.1 GHANA 3.9 the exchange rate system is helping to TANZANIA UGANDA 3.9 3.9 reverse this decline. BURKINA FASO 3.7 SENEGAL MALI 3.7 3.7 10. Cumulative change in CPIA scores RWANDA 3.6 Changes in CPIA scores between 2005 and 2009 KENYA 3.6 MADAGASCAR 3.6 MOZAMBIQUE 3.6 NIGERIA BENIN 3.6 RWANDA LESOTHO 3.5 TOGO ZAMBIA 3.4 COTE D'IVOIRE MALAWI 3.4 MOZAMBIQUE ETHIOPIA 3.4 CENTRAL AFR. REP. NIGERIA 3.3 ANGOLA Largest gains GAMBIA, THE NIGER 3.3 CAPE VERDE MAURITANIA 3.3 KENYA CAMEROON 3.2 BURUNDI GAMBIA, THE 3.2 ZAMBIA SIERRA LEONE 3.1 COMOROS BURUNDI 3.0 SIERRA LEONE SAO TOME AND PR. 3.0 ZIMBABWE GUINEA 3.0 UGANDA CONGO, DEM. REP. 2.8 MALI CONGO, REP 2.8 MALAWI ANGOLA 2.7 LESOTHO CHAD 2.6 ETHIOPIA GUINEA-BISSAU 2.6 BURKINA FASO TOGO 2.6 MAURITANIA NIGER COTE D'IVOIRE 2.6 MADAGASCAR SUDAN 2.5 CONGO, REP CENTRAL AFR. REP. 2.5 SENEGAL COMOROS 2.4 CONGO, DEM. REP. ERITREA 2.4 CAMEROON ZIMBABWE 1.7 GHANA 1.0 1.5 2.0 2.5 3.0 3.5 4.0 4.5 TANZANIA SUDAN Source: Africa CPIA datasheet. SAO TOME AND PR. Largest declines A few countries have consistently had strong policies, with GUINEA-BISSAU average CPIA scores clustered around 4.0: Cape Verde, Ghana, GUINEA BENIN Tanzania, and Uganda. These countries have either maintained ERITREA or strengthened their policies in each of the last five years. CHAD -0.6 -0.4 -0.2 0.0 0.2 0.4 0.6 CPIA scores change only Source: Africa CPIA datasheet. gradually, but some strong policy Over the past five years, Rwanda and Mozambique have made significant and consistent progress in economic and institutional reformers have experienced quality, and have relatively high CPIA scores. considerable improvements and a few countries have seen a sharp Among oil exporting countries, large worsening of their scores. Figure 10 variations in CPIA scores have been lists countries with their cumulative gain observed. Nigeria, Côte d'Ivoire and or deterioration in CPIA scores between Angola had positive changes on their CPIA 2005 and 2009. Over the past five years, scores, the remaining four countries Rwanda and Mozambique have made experienced losses or no change. While significant and consistent progress in Nigeria gained by 0.4 over 2005-09, economic and institutional quality and another oil-exporting country, Chad, saw 7 an equally large deterioration (i.e, -0.4) in world); and Tanzania ranks well in its CPIA score. Some post-conflict enforcing contracts (31st). These same countries, for example Angola and countries, however, create complexities in Rwanda, made substantial progress in other areas of business that hamper improving economic policies. overall economic development. For example, Rwanda ranks very low in terms Trends in indicators: mixed performance of the time and cost of liquidating a Improvement in economic business, and securing a construction management and structural permit in Tanzania takes 328 days -- at a policies is not mirrored in other cost approximating 33 times the per areas of the CPIA. Economic capita income of the country. management and structural policies are the areas in which African countries have By contrast, the quality of shown the most strength and progress. governance is weak and progress Not surprisingly, the indicators for has lagged. While there are indications "economic management" have, on that governance is improving in some average, posted the highest CPIA scores in African countries, weak governance and the region, along with substantial low capacity remain a reality for many improvement. Since the mid-1990s, African countries. Weak governance is African countries have seen strengthening particularly serious in fragile states and of macroeconomic management. External regions, as the costs of conflict are borne and internal imbalances were redressed, not only by those directly involved, but helped in part by debt relief, and inflation also by their neighbors. The public in most countries fell sharply. In 2007, management and institutions cluster of median inflation was about half the level the CPIA has, on average, the lowest score in the early 1990s. At the same time, and has not posted any gains (2005- exchange rates were maintained at 2009). Similarly, the scores on indicators competitive levels, including the one-time for social inclusion/equity policies have devaluation of the CFA franc in 1994. remained low and relatively unchanged. Over the past several years, many African This reflects slow progress on policies of countries have also moved to liberalize social protection, labor market trade, although improvements in trade regulations and equity of public resource facilitation have lagged. use. African countries have made progress in recent years in implementing reforms to support investment climate and to improve competitiveness. For example, the 2010 Doing Business Report finds that a typical import transaction has been reduced to 39.4 days from 58 days in 2006 (versus 11 days in OECD countries in 2010). Delays have a great impact on country's exports, especially that of perishable agricultural products. Because of reforms, Rwanda is now one of the fastest places in the world to start a business (11th overall); securing credit is very straightforward in Kenya (4th in the 8 11. Average CPIA scores by cluster for African 12. Comparison of CPIA scores for oil and non-oil countries exporting countries (2005-09) 3.50 3.39 Change of CPIA scores (2005-2009) within clusters for oil and non oil 3.36 3.37 countries 3.40 3.28 3.29 3.30 0.30 Average CPIA by cluster 3.23 3.25 3.24 3.23 3.22 3.20 0.20 3.10 3.13 3.14 3.12 3.12 3.12 3.00 0.10 2.98 2.97 2.97 2.90 2.95 2.96 2.80 0.00 2.70 Economic Mgt Structural policy Policies for social Public sector mgt inclusion 2005 2006 2007 2008 2009 Economic management Structural policies (0.10) Social Policies Public management and institutions Average OIL Average Non-oil All countries - Change from 2009-2005 Source: Africa, CPIA datasheet Source: Africa, CPIA datasheet The indicators for "economic management" have, on average, Oil countries had stronger gains in the economic management posted the highest scores in the region along with substantial and the structural policy clusters; but in the social policies and improvement. On the other hand, the public management and the public management clusters, oil countries had larger institutions cluster has, on average, the lowest score and has not declines. posted gains over the same period Box 2 Rwanda: strong policy Nearly half of IDA eligible African performance countries have recorded an improvement Rwanda’s steady progress on reforms makes the country one of the strongest performers among in economic management and a lower sub-Saharan African countries. Sound number have seen a strengthening of macroeconomic management and stability, structural policies. By contrast, less than improved business environment, progress in a third of countries have posted human development, and better public sector improvements in clusters 3 and 4. management have contributed to Rwanda's sustained economic growth, which averaged 8 percent a year during 1998-2008. Recent efforts When average scores are disaggregated to improve the business environment helped for oil-exporting and non-oil countries, Rwanda to become a top global reformer in the there is considerable variation in 2010 Doing Business report, which ranked the country at 67 out of 183 economies. Performance- performance of these two groups: oil based salaries and results-based financing for countries posted stronger gains in the health facilities contributed to a dramatic economic management and the structural improvement in health outcomes: for example, policy clusters (Figure 12); but in the child mortality declined by a third over 2000-08. social policies and the public The government has taken measures to improve public sector management: linking the budget to management clusters, oil countries policy priorities; better budget execution and showed larger declines. coordination of government activities. The country’s strong policy environment is reflected in its relatively high CPIA score. 9 Box 3 Madagascar: political instability enjoyed higher GDP per capita (Figure is impacting the country’s policy 13). The analysis also suggests that environment better policies and institutions correlate The recent political crisis has impacted well with economic and human Madagascar, particularly its growth performance development outcomes. Thanks to a and public sector management. Prior to the March 2009 coup, the economy was growing at a rate of strong policy environment, African around 7 percent, fueled by a boom in mining and countries posted strong growth in the tourism. The political crisis also affected the fiscal decade preceding the global crisis. policy as the suspension of external aid restricted public expenditures—particularly public investment, with negative implications for the 13. Higher per capita income is associated with delivery of social and infrastructure services. better policies Consequently, in 2009, Madagascar's overall CPIA score declined to 3.5. 2700.0 Countries with better policies have 2200.0 GNI per capita (2001-08) grown faster The criteria of the CPIA map well with 1700.0 the policies and institutions that are identified in the literature as relevant for 1200.0 growth and poverty reduction. Good policies and strong institutions lead to 700.0 favorable growth and poverty reduction outcomes over the medium term. A 200.0 recent study (Radelet, 2010) finds that 2.0 2.5 3.0 3.5 4.0 4.5 since the mid-1990s seventeen emerging Overall CPIA score (2001-08) African economies have achieved solid, steady growth on the back of five Higher CPIA Scores fundamental changes, including more sensible policies, more democratic and accountable governments and reduced Source: World Development Indicators 2009 and CPIA Africa Data sheet for IDA Eligible countries. debt burdens. An analysis of economic Analysis shows that countries with better policies also enjoyed performance among African countries higher GDP per capita. over 2000-08 shows that the countries with better policies and institutions also 10 Section III Sub-Saharan Africa: Advancing toward the MDGs Notable progress has been made on achieving some MDGs: poverty reduction, primary education, gender parity in primary and secondary school, and access to safe water. Progress on the health goals has lagged, even as under-5 mortality rates are falling and HIV/AIDS prevalence rate is stabilizing. Many countries have made impressive advances, others have not. Improvements in poverty reduction and human development indicators are associated with rising income. The global financial crisis has slowed progress on achieving the MDGs. Boosting economic growth will be central to regaining momentum and closing the gap on the development goals. As the countdown to 2015 begins, Sub- been the group of low income countries Saharan Africa is well positioned to (excluding fragile states). strengthen momentum on achieving the MDGs. Despite these significant gains, most African countries are off-track on most of Since the late-1990s, the region has made the goals. One reason is that the path to substantial progress toward the MDGs. the MDGs has been steeper for Africa The poverty rate has declined by about 1 because of lower starting points. Also, percentage point a year, falling from 59 Some 19 countries2–home to over one- percent in 1995 to 51 percent in 2005. fourth of the region’s population—are Primary school enrollment has seen a 14 fragile or conflict-affected. These percentage point jump, from about 59 countries have fragile political situations, percent in 2000 to 73 percent in 2008-- weak governance, and low capacity for the fastest improvement of any region. service delivery. Progress on the goals Gender parity in education has improved has been slowest in these economies, and as well. The percent of people with access in some cases has even slipped. to safe water has grown appreciably, from Accelerating the pace of progress on the about 49 percent in 1990 to over 59 MDGs in these countries remains a percent in 2008. Even on the health challenge. goals, which have admittedly lagged, progress in absolute terms has been Success on some MDGs impressive. Child deaths have declined by 27 percent, from 181 per 1000 in 1990 Eradicate poverty. The proportion of to 132 per 1000 in 2009. An estimated 73 people living in extreme poverty (average percent of infants have been vaccinated daily consumption of $1.25 or less) has against measles, and coverage of other fallen at a rapid pace, reversing the earlier vaccinations has also expanded. One in stagnating trend. The poverty rate fell six children below five years of age are from 59 percent in 1995 to 51 percent in sleeping under insecticide treated bed nets. Progress has also been made in reducing the number of new HIV 2 IDA eligible fragile states for FY2011: Angola, infections and increasing the number of Burundi, Central African Republic, Cameroon, people receiving antiretroviral Chad, Comoros, Congo, Dem. Rep., Congo, Rep. treatments (ART)—3.9 million in 2009. The Gambia, Côte d’Ivoire, Eritrea, Guinea, Overall, the best performers have often Guinea-Bissau, Sierra Leone, Liberia, Sao Tome & Principé, Sudan, Togo and Zimbabwe. 11 2005, a decline of around one percentage Table 1 point a year. A decade of strong and Cut poverty rate by half sustained policy-driven growth has lifted Achieved On track incomes and, as Figure 14 illustrates, this Central African Republic rise in income has been associated with a Cameroon Ethiopia reduction in poverty. Still, Sub-Saharan Kenya Ghana Africa is the only region not on track to Mauritania Seychelles meet the MDG target of halving, between Senegal Swaziland 1990 and 2015, the proportion of people Source: World Development Indicators, World Bank living in extreme poverty. Nine African Only nine countries have attained or are on track to achieve the target of halving the poverty countries have attained or are on track to rate. achieve the target of halving the poverty rate. Universal primary education. Sub- Saharan Africa has made major strides in 14. Proportion of people living in extreme poverty education. The region showed the fastest and GNI per capita progress, despite being furthest behind, 60 2700 boosting primary enrollment rates by 14 2500 percentage points to 73 percent in 2008. percent of population 50 The primary completion rate has also (in constant USD) 2300 40 surged, rising from 53 percent to 65 2100 percent over this period. The positive 1900 30 trend is broad-based, with the largest 1700 improvement in low income countries. 1500 20 For example, between 2000 and 2008, 1990 2000 2005 Mozambique, Rwanda and Ethiopia saw GNI Per capita (international $) more than a doubling in primary school Proportion of people living under $1.25/day enrollment rates from 16 to 43, 22 to 54 Source: World Development Indicators, World Bank and 23 to 52 percent, respectively. Still, The proportion of people living in extreme poverty (average daily over 30 million primary-school-age consumption of $1.25 or less) has fallen at a rapid pace since children or almost half (45%) of the 1995. global out-of-school population are in 15. Poverty rate in Sub-Saharan Africa 1990-2005 Sub-Saharan Africa3. Large countries such Sub - Saharan Africa as Nigeria and Ethiopia are home to 8.2 65 60 57.6 After crisis and 3.7 million, respectively, of these 55 children, with girls making up the 50 50.9 majority of school drop outs. Although 45 enrollments in early grades have 38.0 40 increased at a rapid rate, teacher 35 absenteeism, weak quality of teaching, 30 Before crisis, 36 inadequate or dangerous school facilities, 25 are among factors that contribute to 20 28.8 children dropping out of primary school. 1990 1995 2000 2005 2010 2015 Addressing these issues is central to enrolling all children and keeping them in Actual $1.25/day Path to 2015 Projected $1.25/day school. Source: Povcal database & Global Monitoring Report, 2010 Still, Sub-Saharan Africa is the only region not on track to meet the MDG target of poverty. 3 UNESCO 2010 “Education for All Global Monitoring Report. www.efareport.unesco.org 12 16. Primary school enrollment in Sub-Saharan gender parity in both primary and Africa secondary education. The indicator of gender parity in primary school has Primary school enrollment rates are rising climbed from about 85 percent in 80% 50 2000 to around 91 percent in 2008. total out-of-school children (millions of persons) Net primary enrollment rate (percent) 45 75% 40 There have been gains at the 70% 65% 35 secondary school level as well. 30 60% 25 Eighteen African countries have 55% 20 already achieved gender parity in 15 50% 10 primary education and another nine 45% 5 are on track to do so, but many African 40% 0 1999 2001 2003 2005 2007 countries are seriously off track. Out-of-school children, primary, total Net enrollment rate (%), primary level, total Gender disparities remain, as girls from poor households and rural Source: World Development Indicators, World Bank communities are least likely to be Sub-Saharan Africa has achieved great progress in education, enrolled in school. boosting primary school enrollment and completion rates. The largest improvement has occurred in low income countries. 17. Primary completion rate in Sub-Saharan Africa Table 2: Progress toward achieving (average 2000-2008) gender equality in Sub-Saharan Africa MDG 3: Promote gender equality & empower Gender Parity in Primary Education Achieved On track 100 Botswana Gabon 90 The Gambia Ghana 80 R² = 0.2203 Kenya Primary Completin rate (%) 70 Lesotho Malawi 60 Mauritius 50 Mauritania Namibia Benin 40 Rwanda Burkina Faso Senegal Burundi 30 Saõ Tomé Principé Comoros 20 Seychelles Ethiopia Tanzania Guinea 10 Uganda Madagascar 0 Zambia Sierra Leone 0 500 1000 1500 2000 2500 3000 Zimbabwe Togo Gender Parity in Secondary Education GNI per capita income (international $) Achieved On track Botswana Congo Republic Source: Staff estimates, World Bank Cape Verde The Gambia Higher income per capita is positively associated with higher Lesotho Ghana Mauritius Malawi Primary school completion rates. Namibia Mauritania Saõ Tomé & Principé Rwanda Gender equality and women’s Seychelles South Africa Uganda Zimbabwe empowerment. Education Source: World Development Indicators, World Bank opportunities for girls have expanded Education opportunities for girls have expanded across the region, shrinking the gender gap. across the region, shrinking the Eighteen African countries have already gender gap. African countries are achieved gender parity in primary education continuing to make progress toward and another nine are on track to do so, but many African countries are seriously off track. 13 Ensure environmental Table 3 sustainability. More people have Improved water Source access to an improved water source. At Achieved On track least 15 countries are on track to reduce Burkina Faso by half the proportion of people lacking Comoros access to an improved water source. The Gambia Ethiopia increased the number of people Ghana Benin with access to safe water from 60 percent Lesotho Cameroon in 1990 to 94 percent in 2008. In addition, Malawi Guinea several other countries have reached over Mauritius South Africa 90 percent coverage for improved access Namibia Swaziland to safe drinking water: Botswana (95%), Saõ Tomé Principé Uganda Comoros (95%), The Gambia (92%), Source: World Development Indicators, World Bank Mauritius (99%), Namibia (92%) and South Africa (91%). By contrast, access to improved sanitation has proved more difficult: in 21 African countries, only 16 percent of peoples in the poorest quintile … mixed progress on others have access to improved sanitation, while for the same indicator, coverage is at 79 Eradicate hunger. Malnutrition and percent for persons in the richest hunger remain a challenge in Sub- quintile4. Saharan Africa. Back-to-back crises have swelled the ranks of people who are 18. Access to clean water hungry and malnourished. Women and children are the most vulnerable. Even Improved access to clean water before the recent food crisis, close to a 70 third of people in Sub-Saharan Africa 65 were malnourished. Some countries such Percent of population with access 60 as Ghana have made impressive strides in 55 addressing hunger, reducing the 50 prevalence rate of undernourished persons to 8 percent in 2006 from 34 45 percent in 1992 (76% reduction). Other 40 strong performers were Congo Republic, 35 Nigeria and Ethiopia, which reduced the 30 prevalence of undernourishment by 25 around 48, 47 and 38 percent, 20 respectively. Fragile states as a group 1990 1995 2000 2005 2008 actually saw a widening of the gap on this sub-Saharan Africa Low income countries Middle income countries target. Children in the poorest households are more than twice as likely to be underweight as those in the richest Source: World Development Indicators, World Bank More people have access to safe water sources. Nine countries households. Tackling food security have already reduced by half the proportion of people lacking remains a priority for the region. access to an improved water source. At least six more are on track to do so. 4 “Assessing Progress in Africa toward the Millennium Development Goals” MDG report 2010. 14 19. People with daily nourishment 5 years. Large disparities exist between richest and poorest children. 50.0 Interventions such as immunizations, exclusive breastfeeding, and insecticide- prevalence of undernourishment (% of 40.0 treated nets remain priorities. population) 30.0 20. Child mortality 20.0 Child mortality rates 1990 - 2009 Under-five mortality rate (per 1000) 10.0 180 181 155 0.0 sub-Saharan Africa Middle income countries excl. Low income countries excl. Fragile states fragile states fragile states 132 130 1992-97 2002-06 105 80 Source: World Development Indicators, World Bank Even before the recent food crisis, close to a third of people in Sub- 55 Saharan Africa were malnourished. Malnutrition and hunger 1990 1995 2000 2005 2006 2007 2008 2009 remain a challenge in the continent. Although some countries have seen progress, the number of malnourished people rose in Low income countries excl. fragile states sub-Saharan Africa Fragile states fragile states. Child mortality rates fell 27 percent from 1990 to 2009 in Sub- Reduce child mortality. Despite Saharan Africa. gains, the gap on the health MDGs remains large. After stagnating for Under-5 mortality in selected Fragile states several years, child mortality rates have begun to fall. Under-five mortality Liberia declined by about 27 percent, from 181 per 1000 in 1990 to 132 in 2009. Three Angola countries are on track to achieve the Eritrea target of two-thirds reduction in under- five mortality rates. Some of the poorest Sierra Leone countries—Eritrea and Malawi—are Cameroon overcoming odds to chalk up remarkable progress. Overall, the group of low Chad income countries (excluding fragile Zimbabwe states) posted the strongest improvement and fragile states the least. But even Congo, Rep. within the fragile states group, there was considerable variation. (150) (100) (50) 0 50 Mortality rate (per 100,000) Still, mortality rates in the region remain Change in under-5 mortality rate high as one in eight children die before their fifth birthday5. The region has 50 Source: World Development Indicators percent of all child deaths in the world Still, mortality rates in the region remain high as one in eight children die before their fifth birthday. but only 20 percent of the children under 5 “Levels and Trends in Child Mortality” Report 2010, Estimates Developed by UN Inter-agency Group on Child Mortality Estimation UNICEF 15 22. Under-5 Mortality rate in Sub-Saharan Africa care from trained workers. While there 2000-2007 has been progress, much remains to be done as more than half of all births in Higher levels of income per capita correspond to lower under Sub-Saharan Africa are not attended by 5 mortality rates (2000-2007 period) skilled staff, and the proportion of Mortality Rate-under age 5 (per 1000) 250 pregnant women who had 4 or more antenatal visits was only about 45 percent 200 (2008). The provision of reproductive R² = 0.2607 150 health services is advancing very slowly as well: contraceptive prevalence rate (% 100 of women ages 15-49) has remained at little over 20 percent in Sub-Saharan 50 Africa in 2000-08. 0 0 500 1000 1500 2000 2500 3000 23. Maternal mortality ratio in Sub-Saharan Africa GNI per capita income (international $) 1990-2008 Deaths & complications from childbirth Source: Staff estimates, World Bank 1000 869 Low income countries (excluding fragile states) posted the Maternal mortality ratio (per 100,000 live births) strongest improvement. 647 750 Improve maternal health. The latest data show that maternal mortality in Sub- 500 Saharan Africa has declined by 26 percent between 1990 and 2009, short of the rate 250 needed to achieve Goal 5. At 640 deaths per 100,000 live births, the region has the most number of deaths from 0 1990 1995 2000 2005 2008 complications in childbirth, over 200,000 Fragile states Middle income countries excl. fragile states a year.6 Fifteen countries saw a decline of Low income countries excl. fragile states over 40 percent in maternal mortality rates between 1990 and 2008; Eritrea Source: World Development Indicators, World Bank (70%), Cape Verde (59%), Ethiopia Maternal mortality in Sub-Saharan Africa has declined by 26 (53%), Rwanda (51%) and Benin (48%) percent between 1990 and 2009. Low income countries (excluding fragile states) made the greatest progress, while posted the largest declines. Again, the performance by middle income and fragile states lagged. Still, largest reduction was in the group of low more than half of all births in the continent are not attended by income countries (excluding fragile skilled staff. states), while performance by middle income and fragile states lagged. Combating communicable disease –HIV/AIDS, malaria and Many of these deaths are preventable through attendance of skilled health-care tuberculosis. The region is beginning to make some inroads on halting the workers at deliveries and better antenatal spread of communicable diseases. The prevalence rate of HIV/AIDS has 6 In sub-Saharan Africa, the central and eastern stabilized and begun to trend down. But regions have shown some improvement since 1990, but the southern and western regions lagged because of the number of pregnant women who died from HIV infection 16 the statistics are grim: some 41 million7 Saharan Africa, and most are among people in the region are living with children. Considerable progress has been HIV/AIDS; two-thirds of the world’s made in scaling up insecticide-treated bed young people with HIV/AIDS are in Sub- net use among children, from 2 percent in Saharan Africa, most of them women; and 2000 to 20 percent in 2006. In Ethiopia nearly three-fourths of AIDS-related in 2010, 90 percent of children under the deaths (in 2008) were in the continent. age of five sleep under insecticide-treated Access to antiretroviral treatment has bed nets, compared to 5 percent in 2003. increased, contributing to the decline in Tuberculosis prevalence and mortality AIDS deaths. Despite better coverage, rates are falling in the other regions, but only 37 percent of those in need receive prevalence is still high in sub-Saharan treatment. Africa. Better health results will require strengthening health systems— 24. HIV/AIDS improving supply chains for distribution of drugs, providing better access to health Number of people receiving ART in SSA services, training more health-care workers and improving the quality of 3.9 million care. 37% people received ART 2009 Regaining momentum on the MDGs 63% The global financial crisis substantially increased the challenge of meeting the Number of people receiving antiretroviral therapy MDGs. The crisis has slowed the regional Estimated number of people needing antiretroviral therapy trend on reducing poverty: the poverty rate on current trends is now projected to fall to 38 percent by 2015, above the 36 ART for preventing transmission of HIV/AIDs percent that was projected before the to new borns in 2009 onset of the global financial crisis--20 million fewer people will be lifted out of 673 000 poverty (Global Monitoring Report 2010). pregnant women have Many millions more will suffer from 46% 54% received ART hunger and undernourishment. Although most African countries are off- track on most of the MDGs, over a decade Number of pregnant women living with HIV receiving ART for preventing of progress has shown that Sub-Saharan mother to child transmission of HIV Estimated number of pregnant women living with HIV in need of ART for Africa can make impressive strides prevention of transmission to newborn toward these goals. The countdown to Source: World Development Indicators, World Bank 2015 presents a unique opportunity to The prevalence rate of HIV/AIDS in Sub-Saharan Africa has intensify efforts on achieving the goals. stabilized and begun to trend down. But the statistics are grim: African countries need to build on the some 41 million people in the region are living with HIV/AIDS. progress they have made. Access to antiretroviral treatment has increased, but still only 37 percent of those in need receive treatment. Economic growth is necessary to closing Of the 1 million malaria-related deaths in the gap on the MDGs. Evidence shows the world, 90 percent occur in Sub- that rising income is closely associated with progress on the development goals. 7 Based on 2007 HIV/AID data available, WDI The positive pre-crisis trend that African working database. 17 countries were seeing on poverty reduction and human development indicators was thanks to strong growth since the mid-1990s in these countries, fueled by prudent macroeconomic policies, far-reaching reforms, and a favorable international environment. Strong, sustained growth in the continent will require a continuation of sensible economic policies, closing of the infrastructure deficit, and good governance. The major economies of the world can help by pursuing policies that boost world growth and enhance global financial stability. More and better quality aid to support countries’ reform efforts will be important as well. Although the global economic crisis has slowed momentum toward the goals, the development community needs to set its sights on redoubling efforts and getting back on track. At the recently concluded UN Summit on the MDGs, there was a strong sense of commitment to the development goals and to accelerating progress toward the goals. As the countdown to 2015 gets underway, developing and developed countries will need to continue working in partnership to address the challenge of fulfilling these goals. Multilateral institutions such as the World Bank Group can support countries to achieve the MDGs through a range of financial, technical and knowledge services. 18