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African economies growing steadily – Wigwe

By on November 18, 2014

The Group Managing Director, Access Bank, Mr. Herbert Wigwe, says the nation’s economy and others in Africa are growing steadily despite the challenges in the global economy.

He also said that the continent’s vibrant and growing consumer class was increasingly being serviced by innovative local capital.

He spoke at the African Financial Summit organised by the bank and the Institute of International Finance in Lagos.

Wigwe said, “A vibrant, growing consumer class is increasingly being serviced by innovative local capital. From FMCG to telecoms, street vendors to sophisticated local retailers, the African private sector is driving economic growth.

“Add to this a young, increasingly healthy and well educated population and you have a market that is growing exponentially, with plenty of spare capacity and tremendous opportunities to extend services to that market.”

The Access Bank Chief Executive Officer, however, said the continent must align with global standards and best practice, while maintaining its cultural identities and local knowledge.

Wigwe, who spoke on ‘mobilising resources for investing in Africa’, further said that “Technology has enhanced access to capital, expertise and distribution, and aided the storage and use of data.

“This presents us with a profound opportunity to deepen and widen access to financial services to people and companies across the continent and we should ensure that we use it for good.”

The Minister of Finance, Dr. Ngozi Okonjo-Iweala, who was also at the event, said events unfolding over the past six months had cast a shadow over the recovery of the global economy in the aftermath of the 2008/2009 global financial crisis.

She explained that “despite the fragile recovery in the United States, you have weaker than expected recovery in other places of the world, especially in the Euro zone and emerging markets including China and Brazil. All these have led to the downward review of the global economic outlook. Without a doubt, the slowdown of the global economy and the Quantitative Easing wind down in the US will affect the sub-Saharan Africa.

“The end of quantitative easing by monetary authorities in the US is resulting in a reversal of foreign investor sentiment in emerging markets including frontier markets such as sub-Sahara Africa. Thus, capital out flows are putting pressure on countries with large external financing needs. In addition, regional challenges, such as the recent outbreak of the Ebola virus in West Africa is weighing down on the region’s short to medium term economic outlook.

She added, “In general, the ensuing decline in activity may lead to reduced appetite for investment, with more long-term implications on the growth momentum in the sub region. Already, the IMF has cut its earlier projection of a 5.5 percent GDP growth in 2014 for sub-Sahara Africa by 0.4 percent. Growth is now expected at 5.1 percent in 2014, and 5.8 per cent in 2015.”

 

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