Good news for African oil producers Angola and Ghana. Their economies are both expected to grow by more than seven percent this year. But the growth is less robust than last year as lower oil and commodity prices weigh, according to a Reuters poll.
The growth in both countries is being driven in part by rising oil production and a drop in the oil price prompted analysts in the poll to cut their 2013 economic outlooks from previous polls, reports Gulf Daily News.
Angola’s economy will grown 7 percent this year, down from an estimate of 7.4 percent in a poll taken in March. Next year, it is expected to grow 7.2 percent.
“We have dropped our growth forecast due to the bearish outlook for oil prices–Angola’s economy is highly dependent on the oil sector,” Celeste Fauconnier, Africa analyst at Rand Merchant Bank, told Gulf Daily News.
Angola also launched a $5-billion sovereign wealth fund in October to invest in domestic and overseas assets by using its oil wealth to be spent on infrastructure, hotels and other projects to diversify its economy outside the energy industry.
In Ghana, its economy will grow 7.5 percent this year, a drop from 7.7 percent in a previous poll in February.
Ghana is benefiting from the expansion of its oil and gas sector since its Jubilee fields went into operation in November 2010. However, weak gold prices, down by about a quarter this year, and loose fiscal policy continue to be risks.
In 2014 the economy will dip an expected 7.3 percent.
“We remain bullish on growth due to expected increases in oil and gas production and the strong performance of the agricultural sector,” said Rand Merchant Bank’s Fauconnier. “The drop in gold prices, however, is a major risk to our outlook as the sector attracts a large piece of export revenue for the country.”
“Analysts have slashed their 2013 gold price forecasts after sharp falls earlier this year and expect them to remain weak in 2014. Oil prices meanwhile should average $106.20 per barrel in 2013, well below last year’s average of $111.70, and fall to $104.30 next year. Nigeria, Africa’s top oil producer, was forecast in a separate poll last month to grow 6.7pc this year,” reports Gulf Daily News.