Africa is likely to see gross domestic product growth of 6.0 percent next year and 6.5 percent in sub-Saharan Africa, African Development Bank President Donald Kaberuka said on Thursday.
“I think next year Africa will be growing at six percent. In sub-Saharan Africa it will be six and a half percent,” he told Reuters in an interview, adding “Africa is coming out of the (global financial) crisis stronger; it’s developing a strong relationship with emerging markets.”
He said the bank was likely to borrow $3 billion to $3.5 billion on international markets in 2011.
“We can borrow around three to three and a half billion (dollars) in 2011. We are going on a borrowing program shortly. We have no difficulty raising funds,” he said, adding that the bank was able to secure funding below the London interbank offered rate. “We are back to LIBOR minus,” he said on the sidelines of a business forum, without elaborating.
The AfBD said earlier this year that it expected growth of 5.2 percent for next year, but a stronger than expected rebound led by demand for the continent’s commodities has confounded economists’ expectations.
The continent would be back to its average GDP growth trend of 6.0 percent reached during the decade before the financial crisis, which slashed growth to 2.9 percent in 2009.
Economists expect Africa to grow by 5 percent this year.
The AFDB has tripled its capital base this year to $100 bln, giving it greater fire power to tackle the huge infrastructure deficit faced by countries across a continent of a billion people.
The AFDB’s shareholders are Africa’s 53 nations and 24 non-African donor countries.
Low interest rates in developed market have encouraged investors to look elsewhere to fast-growing, high-yield emerging and frontier markets.
“Money is looking for yield,” Kaberuka said.