The African Development Bank (AfDB) has said that external debt rose in West African region from 13.5 per cent in 2013 to 23.6 per cent of GDP by end of February.
The President of the bank, Dr Akinwumi Adesina, said this at the inauguration of 2019 African Economic Outlook and West Africa Regional Outlook in Abuja on Tuesday.
Adesina who was represented by AfDB’s Senior Director in Nigeria, Mr Ebrima Faal, said the issue of external debt was back on the radar in many countries.
He noted that an average external debt was on the rise in the region, saying that it had nearly doubled over the past six years.
He said that the delicate security situation in some parts of the region had continued to impede its economic performance and social stability.
According to him, migration is another concern, fundamentally driven by rising youth unemployment.
“It is important for us to know and understand these challenges, because these issues need to be present in the dialogue we engage with our member countries and factoring in while designing development projects and programmes.
“There are significant structural and externally induced downside risks to the growth forecast of the region in 2019.
“The unresolved trade tensions between United States of America and China, the Middle East crisis, and the recurring sanctions on Iran and the uncertainties surrounding BREXIT.
‘’And the predicted slowdowns in European Economies like German and France posed threats to the region.
“These risks could affect trade and fiscal balances for Africa’s net commodity exporters while will further weaken the already dwindling foreign capital inflows to Africa,” he said.
The president noted that the region could benefit immensely from many opportunities that could counter balance the downside risks.
Adesina, however, urged countries in the region to embrace diversification and economic transformation as key to reducing the impact of external shocks and in creating productive jobs and promoting sustainable and inclusive development.
He said that infrastructure development across countries in the region would go a long way in reducing the cost of doing business and provide a boost to private investment.
He said a regional value chain approach would assist different economies to integrate regionally and focus on sectors that offer differentiated growth potential. (NAN)