Africa-Press – Cape verde. THE Economic Commission for Africa has urged governments to increase development spending to stimulate fast and sustained recovery on the back of multiple crises that hit African economies.
Launching the World Economic Situation and Prospects 2023 (WESP) report in Addis Ababa last week, Adam Elhiraika, the commission’s director of the macroeconomics and governance of the ECA, said African countries have been affected by multiple crises and need to increase spending for a fast recovery.
“Africa is confronted with weaker external demand and elevated energy and food prices in addition to rapidly increasing borrowing costs and adverse world events,” Elhiraika said, echoing the findings of the WESP report indicating that growth in Africa was projected to slow down to 3,8% in 2022 from a projected 4,1% at the beginning of 2022.
Elhiraika said the world continues to be confronted by multiple, inter-connected crises amid a slow recovery from the impact of the Covid-19 pandemic.
The WESP report underscores the need for supportive and accommodative fiscal measures to lift growth and accelerate progress towards the SDGs.
The report also emphasises the need for governments to take a strategic approach in redirecting public expenditure towards sectors with high fiscal multipliers and better targeting of vulnerable groups, Elhiraika said.
“In addition to supporting short-term public demand, public investment can stimulate capital formation and expand productive capacities and lift potential growth… as growth improves, this can help countries confront the debt sustainability problem,” said Elhiraika.
WESP is an annual flagship publication produced by the UN department of economic and social affairs in collaboration with the United Nations Conference on Trade and Development and the five United Nations regional commissions.
Lee Everts, the chief of macroeconomic analysis section, said the WESP is of particular importance to Africa as the world confronts multiple and interconnected shocks.
“In the midst of sluggish recovery from the effects of Covid-19 , the world is facing food and energy crisis aggravated by the Ukraine War, as well as the cost of living crisis caused by record inflation,” Everts said, noting that consistent and interconnected shocks are deepening and widening poverty and inequality and threaten to reverse two decades of progress made in countering them.
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