East Africa region projected to grow at 3%
This will be an improvement from the lethargic rate of 0.9% the region posted last year due to the effects of COVID-19. ...
A study by Deloitte has revealed that the East African region growth is expected to rebound from the doldrums and shoot to 3% this year.
This will be an improvement from the lethargic rate of 0.9% the region posted last year due to the effects of COVID-19.
The economic growth will be mainly driven by private consumption and domestic demand.
The report titled 'the Economic Impact of the Covid-19 pandemic on East African economies', covered Kenya, Ethiopia, Tanzania, Uganda, and Rwanda under the theme 'Navigating New Realities'.
However, Deloitte East Africa Financial Advisory Leader, Gladys Makumi noted that the recurrence of lockdowns, slow vaccine roll-out across the region, restriction in movements, and budgetary pressures in some of the major economies will negatively impact the growth.
Tewodros Sisay, Deloitte East Africa Financial Advisory Associate Director said in a statement that despite Africa’s economy contracting by 2.1%, countries have largely remained resilient amidst the pandemic and continue to chatter a new path towards recovery.
“Recovery will be driven by tourism, agriculture, and manufacturing sectors. Subsequently, it will also be driven by an uptick in investment activity in the private sector with long-term effects of foreign direct investment diversification expected to take effect, Sisay said.
Notwithstanding, foreign direct investments inflows into the East African region contracted by 9.6% in 2020.
As Uganda was emerging from the ruins of the first wave of coronavirus, the country was hit by a deadly second wave prompting another lockdown. Projections have put Uganda’s economic growth rate at 3.3%
The World Bank has projected growth rates of 4.6% and 6.4% in the 2022 and 2023 financial years as domestic demand conditions improve and global recovery continues as COVID-19 vaccines are rolled out.