Mali- Growth Projected 5.1% in 2014

Mali-Flag-

 

 

 

 

 

Mali food crisis that began in 2011, the 22 March 2012 coup d’état marked the beginning of a serious political crisis, with armed groups occupying the three northern regions (two-thirds of the national territory) between April 2012 and January 2013. An African and French military intervention was carried out against these groups in January 2013. Consequently, the economy largely ground to a halt in 2012, and international cooperation was suspended. Real gross domestic product (GDP) growth was -1.5% in 2012 due to the weak performance of the secondary (-2.2%) and tertiary (-8.8%) sectors. For its part, the primary sector grew by 8.1%.

Despite the recession and the suspension of international aid, the government pursued a policy of fiscal discipline in 2012. It restored its relations with the International Monetary Fund (IMF) in January 2013 and obtained a Rapid Credit Facility (RCF) of USD 18 million.

The economy is forecast to come out of recession, with growth projected at 5.4% in 2013 and 5.1% in 2014. This growth will be driven by rice, cotton and gold production, as well as by the creation of a third mobile network operator. That said, political instability, economic crisis and war in the north of the country still pose downside risks for 2013 and 2014.

The food, security and political crises have all exacerbated poverty. The rate increased from 41.7% in 2011 to 42.7% in 2012. A serious humanitarian crisis began in January 2012, with 237 000 displaced persons, 410 000 refugees and at least 4.6 million Malians at risk of food insecurity. The government honoured its spending commitments on education, health and social protection, which made up 33.45% of total expenditure. Social indicators have improved in recent years, but progress towards achieving the Millennium Development Goals (MDGs) by 2015 remains mixed. Mali is on track to achieve universal primary education (goal 2), combat HIV/AIDS, malaria and other diseases (goal 6) and ensure environmental sustainability (goal 7), including the provision of drinking water.

It will almost certainly fail to achieve the other goals, however. The Islamist groups that occupied the northern regions for nine months pillaged healthcare centres, pharmacies and schools, putting a significant dent in progress made.

Earnings from gold production represent about 25% of GDP and 75% of export revenue. Gold’s place in the economy has continued to grow over the past twenty years. Despite this, there has been no endogenous creation of added value through beneficiation. Development of the mining sector (7.6% of GDP) has also not led to the creation of national operators and service providers.

Cotton makes up about 1% of GDP and 15% of export revenue. Following the crisis that began in the 1997/98 season, the sector is doing relatively well. The government subsidises material inputs, guarantees prices for producers and provides support and advice to producer organisations. Among other positive factors are the restructuring of the Malian textile development company (Compagnie malienne de développement du textile,
CMDT) and stable global cotton prices. The increase in production has not however been accompanied by the development of a local cotton processing industry.

 

 

( Courtesy Government of Mali & Africa Economic Outlook……Source…… New Africa Business News Economic Freelance Contributor, in Lagos, Nigeria )

About the Author
Moses M'Bowe, is the Chief International Correspondent, For New Africa Business News And New Africa Daily News.

Related Posts

Leave a Reply

*

Africas Best Newspaper