03 Feb 2015

Despite a relatively higher growth rate projected for 2014, the Southern African Development Community (SADC) region continues to face several development challenges such as youth unemployment and a high incidence of poverty.

Minister of Finance and Development Planning, Mr Kenneth Matambo, revealed this when he presented the 2015/16 budget to Parliament on Monday.

Mr Matambo said in a bid to address the challenges in the coming years, the region would need to grow faster than the 5.2per cent projected for 2015 which could be achieved through regional integration.

“In this regard the revised SADC Regional Indicative Strategic Plan for the period 2015-2020 has identified industrial development and market integration as one of the key priorities to drive the regional integration agenda,” he said.

The minister said the performance of the global economy continued to be uneven with the recovery remaining fragile last year. 

According to the World Economic Outlook (WEO) report the International Monetary Fund (IMF) released last month, Mr Matambo said projected world economic growth remained unchanged at 3.3 per cent in 2014, the same growth achieved in 2013.

He said advanced economies were expected to grow by 1.8 per cent in 2014 as compared to 1.3 per cent in 2013. 

“Debt accumulation by advanced economies remained high thus affecting world output growth prospects. In the sub Saharan African region, growth is expected to be 4.8 per cent in 2014, a decline of 0.4 per cent point compared to 5.2 per cent recorded in 2013. Some of the downside risk factors expected to affect global output in 2014 comprise, uncertainty about future oil price path, financial markets volatility as well as stagnation and low potential growth especially in advanced economies and emerging markets,” he added.

The minister said the real Gross Domestic Product (GDP) growth in the SADC region averaged 4.9 per cent in 2013, slightly higher than 4.8 per cent in the previous year. 

The moderate growth performance of the region, according to Mr Matambo was due to the decline in global commodity prices and slow global economic recovery. 

He noted that the region was expected to have registered a higher growth rate of 5.2 per cent in 2014. ENDS