Mozambique leads continent in inclusive growth potential
JOHANNESBURG, (CAJ News) – MOZAMBICAN cities have emerged as the municipalities with the highest potential for inclusive growth in Africa, thanks to increasing foreign direct investment (FDI) and improving levels of transparency and ease of doing business.
Mozambique has in recent years seized the spotlight for its growing oil and gas reserves resulting in a marked increase in foreign investment flows.
The former Portuguese colony, whose gross domestic product (GDP) of US$16,5 billion, the International Monetary Fund (IMF) has projected to grow by 7 percent in 2015, attracted $9 billion in capital investment last year.
According to the 2015 African Cities Growth Index (ACGI) released in Johannesburg this week, Maputo, the country’s capital, is the large (NB: Not Largest) African city with the highest potential for inclusive growth.
Maputo’s inclusive growth potential falls into the medium-high category, attributed to its share of Mozambique’s FDI, which as a percentage of national gross domestic product (GDP), is among the highest in the world.
The Indian Ocean port city of Maputo slightly more than 1 million people boasts constantly improving levels of government effectiveness, regulatory quality, and ease of doing business.
Casablanca and Lagos, the major cities of Morocco and Nigeria, rank second and third respectively.
Matola, which is adjacent to Maputo to the west, is the ACGI’s medium-sized city with the highest potential for inclusive growth.
It is also the city with the highest potential for growth throughout Mozambique, suggesting the positive outlook for the inclusive economic growth and development of the Southern African country in the future.
Matola, has a population of 800 000, is followed by Nouakchott (Mauretania) and Libreville (Gabon) in that category, with the three cities having medium-high inclusive growth potential.
Meanwhile, of the small cities assessed, Windhoek (Namibia) and Victoria (Seychelles) rank first and second respectively with medium-high inclusive growth potential.
Gaborone, the Botswana capital, is third, with medium-low inclusive growth potential.
Mastercard, the multinational financial services corporation, compiled the ACGI, which provides insights into the opportunities for investment, commerce and higher standards of living in teh continent.
Now in its third year, the ACGI maps African cities’ economic outlook according to their potential for inclusive urbanisation.
The 74 analysed cities are organised into three categories by population size: large (over 1 million), medium (between 500 000 and 1 million) and small (under 500 000).
Some 25 economic and social inclusion indicators rank cities’ level of inclusive urbanisation, forecasting potential for inclusive growth.
Once ranked, the cities fall into one of four bands describing their inclusive growth potential – high, medium-high, medium-low or low.
Prof. George Angelopulo, author of the 2015 ACGI, said the index assessed the potential of Africa’s cities to increase the well-being of their urban populations.
“As inclusive urbanisation is a prerequisite for inclusive growth, the study presents a measure of each city’s potential as a place to live, work and do business in the coming years,” said Angelopulo.
He pointed out each city assessed by the ACGI has a unique set of socio-economic, cultural and political factors that influences its growth trajectory.
A city’s response to the drivers of population growth, urbanisation and an increasing middle class ultimately determines the upward or downward direction of its inclusive growth.
“Cities with skilled and educated populations, low levels of crime and corruption, higher discretionary income, regulatory stability and predictable commercial environments are beacons for talent, business and investment, and they offer their citizens greater promise than cities without these characteristics,” Angelopulo said.
– CAJ News
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