GDP growth: strong, but likely below 10% y/y
While we see a strong export and infrastructure bias in the government’s development plan, the financing of which is unlikely to be troublesome, we are still more reserved in our forecasts for GDP growth, relative to that targeted by the government. We expect GDP growth to average 8.3% y/y over the next two years.
Financing constraints are unlikely to be material for the economy. High national savings and ability to mobilise international capital should ensure that investment spending remains elevated. An improvement in agricultural production would be pivotal in ensuring reacceleration in GDP growth in the medium term. Exports are still low but will be boosted by the commencement of exports in key industries.