A third of African countries have economies growing by more than 6 percent and almost half of them – 26 out of 54 – are now considered middle income countries, according to a new report by African Development Bank.
This growth was driven by the private sector. Looking ahead, growth will rely on regional economic co-operation and intra-African trade, the report said.
Africa’s collective gross domestic product per capita reached $953 last year, and the portion of the population living below the poverty line dropped from 51 percent in 2005 to 39 percent in 2012, BBCNews reports.
Starting a business in Africa will cost you two-thirds less than it did seven years ago.
Africa’s middle class is estimated to be 350 million people.
African Development Bank’s Annual Development Effectiveness Report said Africa’s growth was mainly driven by the private sector thanks to improved economic governance and a better business climate on the continent.
“This progress has brought increased levels of trade and investment, with the annual rate of foreign investment increasing fivefold since 2000,” the report said.
Inadequate infrastructure development and inequality of incomes remain a “major constraints” to the continent’s economic growth, BBCNews reports.
“Africa currently invests just 4 percent of its collective GDP in infrastructure, compared with China’s 14 percent,” the bank’s report said.
Africa will also be challenged “to address continuing inequality so that all Africans, including those living in isolated rural communities, deprived neighborhoods, and fragile states are able to benefit from this economic growth, the report said.