6 out of 10 of the fastest growing economies in 2018 are in Africa

Africa is the fastest growing Continent

2018 has shown a lot of promise for African countries – the world’s top five fastest growing economies are on the African continent. This surge in growth is mainly attributed to the young and fast-growing population on the continent. Latest forecast also points out that most top performers are non-commodity intensive economies, which are expected to continue growing at a steady pace.

Here are, in ascending order, the top 5 growing economies in Africa for 2018.

Fifth Position: Senegal

Senegal started 2018 with high expectations after the inauguration of its new airport in late 2017, at the cost of $575 million. The country’s economy is driven primarily by its strong agricultural sector, with a number of support programs and a solid external demand. Secondary sectors such as energy, food and chemicals have slowed down, despite positive performances. The transport and hospitality sectors have also seen a strong positive demand and has been strongly contributed to lowering the unemployment rate over the past years.

Fourth Position: Djibouti

With its newly operating railway and upgraded port facilities, Djibouti has been setting every chance on its side to become a logistics powerhouse. With the help of China, Djibouti constructed a new export-processing free zone to enhance its industrial activities. The country has seen strong positive demand and will very likely benefit from investment growth again in the near future. In 2017, Djibouti's gross domestic product amounted to around $2.03 billion and is projected to reach around $2.19 billion in 2018.

Third Position: Ivory Coast

Ivory Coast, also known as Cote d’Ivoire, is one of Africa’s most promising economies. The country is the world’s leading cocoa and cashew nut producer and oil exporter. The past few years saw Ivory Coast make a strong rebound in the agricultural sector, showing its resilience to internal and external conditions. Current political stability and an exceptional cocoa yield has had a highly positive impact on the country’s GDP, expected to hit the $45.88 billion mark in 2018.

Second Position: Ethiopia

Ethiopia’s current growth strategy has been to diversify its economy as much as possible and this has clearly had very positive effects on the country. Coffee is the major export crop of Ethiopia, and the country has been pushing for energy conservation, manufacturing and textiles. Another major driver is its successful aviation industry - Ethiopian Airlines, which has recently become an example to follow on the continent. In 2017, Ethiopia's gross domestic product amounted to around $80.87 billion, and is expected to reach $83.84 billion in 2018.

First Position: Ghana

As revealed by the World Bank, Brookings Institution, International Monetary Fund and the African Development Bank, Ghana is the world’s fastest growing economy this year (2018). With the discovery of major offshore oil deposits and the rise of oil prices, the country’s oil production has rapidly expanded.

Other reasons for Ghana’s success may be attributed to market-based economy, with few policy barriers to trade and invest, compared to other countries in the region. Sound political reforms and sustained reduction of poverty levels in recent years have contributed to the country successful performance. In 2017, Ghana's gross domestic product amounted to around $47.02 billion and is expected to hit $51.82 billion in 2018.

Forecast for the upcoming year

Economist Corporate Network suggests that the global economy has been shifting from developed countries to move to developing ones. Statistics this year proves them right, with the world’s top 5 fastest growing economies all belong to the African continent.

2018 has been a highly promising year for Sub-Saharan African economies. According to the World Bank, growth rate on the African continent will reach around 3.5% in 2019.

The African continent is booming in recent years. From famous brands to state-owned companies, everyone is making a move to join the next business revolution.

Expansion on the African continent may be daunting for many, due to the number of obstacles associated to a wide number of laws and regulations. However, to avoid most of the setbacks and get started the 'smart way', companies often use the services of Africa HR Solutions - the top PEO and Payroll Solutions provider on the African continent.