Gambia GDP is expected to grow by 5.5%, as projected by Ecobank’s FICC guidebook 2016.
Ecobank’s Middle Africa Fixed Income, Currency and Commodities (FICC) Guidebook serve as an essential reference tool for any institution or investor interested in monitoring recent developments in debt markets, exchange rates, macroeconomic performance, and commodities across the 36 African countries.
Below we summarized the key economic information about the Gambia.
Economic Outlook of the Gambia
The report projected the following key economic indicators about the Gambia.
Gambia GDP ( real GDP)
Gambia GDP is expected to remain good, at over 5% in 2016, driven by improved agricultural output (assuming normal weather) and ongoing, albeit weak, growth in tourism.
Inflation
Inflation is also projected to remain relatively modest at around 5%, assuming fiscal restraint and the effect of continued good weather on crop production.
Fiscal balance
The fiscal deficit is likely to narrow in 2016, helped by improved policy implementation, including efforts to boost revenue, contain expenditure, and develop further the cash budgeting scheme to strengthen budget execution. It will remain important to ensure that public enterprises are operated on a sound financial basis and steadily implement reforms, particularly in the energy sector, to prevent the deficit from widening further.
Current account
Meanwhile, a large current account deficit, of around 11% of GDP in 2016, will continue to be financed mainly by FDI and donor grants/credits.
Risks
The Gambia’s large balance of payments and fiscal imbalances in 2015 are likely to continue in 2016. They were caused by imposing a highly overvalued exchange rate, policy slippages and persistent financial difficulties in public enterprises, and were exacerbated by the impact of the regional Ebola outbreak on tourism. Any additional major policy slippages will worsen the outlook further, especially since budget support grants will not be forthcoming.
Select Economic Indicators
| Select Economic Indicators | 2012 | 2013 | 2014 | 2015e | 2016fp |
|---|---|---|---|---|---|
| Real GDP (% change) | 5.6 | 4.8 | (0.2) | 4.7 | 5.5 |
| GDP (USD bn) | 0.9 | 0.9 | 0.8 | 0.8 | 0.8 |
| Inflation (average) | 4.6 | 5.2 | 6.2 | 6.5 | 5.3 |
| Fiscal balance (% GDP) | (4.4) | (8.4) | (10.0) | (6.3) | (4.3) |
| Broad money (%change, end period) | 7.8 | 15.1 | 11.2 | 11.0 | 15.0 |
| Population (mn) | 1.8 | 1.9 | 1.9 | 2.0 | 2.1 |
| Exports (USD mn) | 125.4 | 132.2 | 123.5 | 112.2 | 122.0 |
| Imports (USD mn) | 326.0 | 304.1 | 335.0 | 291.8 | 296.1 |
| Current account balance (% GDP) | (7.9) | (10.2) | (13.1) | (13.5) | (10.7) |
| FX reserves | 183.8 | 161.1 | 111.9 | 80.2 | 111.5 |
| Exchange rate (average) | 31.1 | 34.0 | 40.0 | 41.1 | 41.3 |
| e=estimate; f=forecast |
Trade flows of the Gambia
The guidebook also highlighted major trade flows of the Gambia based on the 2014 trade information.
Imports to Gambia
The Gambia’s imports totaled USD388 million in 2014, 10.9% higher than the previous year. Given the country’s limited natural resources, The Gambia is dependent on imports of petroleum products and food, worth USD82 million and USD127 million, respectively. The country is also reliant on imports of electronics, machinery, vehicles and iron and steel (together worth USD63 million in 2014), reflecting the lack of a manufacturing sector.
Exports from Gambia
The Gambia’s exports totaled USD104 million in 2014, 2% lower than the previous year. Woven fabrics are The Gambia’s most valuable export, worth USD63 million in 2014, most of which went to Mali and Guinea.
Fuel wood (charcoal) is the country’s most valuable commodity export, worth USD8 million in 2014, all of which went to China. The Gambia also exported 78,000 tonnes of cashew nuts (worth USD5 million) to India for processing, reflecting its role of as a re-export hub of cashews produced in neighboring Senegal and Guinea-Bissau.
You can read the full FICC report about Gambia and other African countries on Ecobank site.
Be the first to comment