Monday, February 21, 2011

Gambia’s GDP growth slows down

The growth of The Gambia’s Gross Domestic Product (GDP), which is the total monetary value of all goods and services produced domestically in the country over a specified period, has drop from 6.3 per cent in 2008 to 5.6 percent in 2009. GDP includes income earned domestically by foreigners, but does not include income earned by domestic residents on foreign ground.

The growth of GDP from one period to another is an indication of how healthy the country's economy is.

The latest report of the Central Bank of The Gambia (CBG), explained that the contraction in the country’s GDP growth “was due to the decline in the growth of agricultural output and the impact of global economic crisis”. “However, this growth rate was higher than the International Monetary Fund revised forecast of output growth of the world economy, which is -0.8 per cent and 1.6 per cent for sub-Saharan Africa in particular,” the report states.

The CBG report, which was recently presented to the National Assembly, by the Governor of Central Bank of The Gambia, Amadou Colley, noted that the Macroeconomics performance in The Gambia was solid in the past three years, evidenced by GDP growth rates of 6.0 per cent in 2007, 6.3 per cent in 2008 and 5.6 per cent in 2009.

“These growth rates are also within the 6 – 7 per cent range commonly used as a marker, if a country is to achieve the Millennium Development Goal of reducing poverty by 2015. Given the population growth rate of 2.8 per cent in 2007, average per capita growth for the past three years (2007 – 2009) was 3.2 per cent,” the report noted.

The Gambia has maintained macroeconomic stability amidst the global economic crisis with a flexible monetary policy, implementation of structural reforms and technical and financial support from development partners.

Growth in agriculture

The report indicated that agriculture, which is the mainstay of The Gambia economy, employing about 60 – 70 per cent of the workforce, grew on average by 6.2 per cent between 2001 and 2009. “Low domestic production against the backdrop of myriad of factors including low agricultural technology, lack of inputs, and challenges involve in marketing the produce implies that the agricultural sector has not been able to address the food needs of county. With a population growth of 2.8 per cent, average agricultural GDP growth was only 3.4 per cent,” it says.

Food inflation decelerates

Food consumer price inflation declined markedly from 8.6 per cent at end-December 2008 to 2.9 per cent in December 2009, attributable to the removal of import duties on some basic food items, and also enhanced supply.

The report observed that at the beginning of 2009, food consumer price inflation was 8.8 per cent. It decline to 8.3 per cent in March, 6.7 per cent June, as well as 2.7 per cent in September, before edging up slightly to 2.9 per cent in December 2009.

Non-food inflation

Non-food consumer price inflation, which was at 4.7 per cent in January 2009, has increased slightly to 4.8 per cent at end-March before declining to 3.9 per cent in June and 1.9 per cent in September 2009. “Non-food inflation rose gradually to 2.8 per cent in December 2009 albeit lower than 4.4 percent recorded the same period last year,” the report says

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