East African economies are expected to continue registering strong growth this year largely driven by buoyant service and construction sectors, but political crisis in the region is seen to overshadow the positive outlook.

Lower global oil prices are also expected to support the development of the East African Community (EAC) economies, which are net oil importers, by boosting consumer demand and competitiveness as well as mitigating inflationary pressures.  

READ: Rising inflation takes its toll of region’s economies

According to the latest Economic Outlook Report 2015, released by African Development Bank (AfDB), growth is expected to pick across the region led by Rwanda with 7.5 per cent, followed by Tanzania at 7.4 per cent, Kenya 6.5 per cent and Uganda 6.3 per cent.

Burundi is expected to register the least growth at 4.7 per cent. 

“East Africa has been the most dynamic part of Africa without oil and gas. I think that will continue,” Donald Kaberuka, the outgoing president of AfDB told The EastAfrican. 

The region’s growth accelerated last year to more than 7 per cent, from below 5 per cent in 2013, according to the report. 

However, this positive outlook is overshadowed by the political crisis in South Sudan which is expected to weigh down East African economies – with overall regional average now expected to dip to 5.6 per cent in 2015, down from 7.1 per cent registered in 2014.

This is largely due to the fact that the crisis led to a cut in oil production and gross domestic production (GDP) in 2013.

“It recovered in 2014 but is projected to decline again in 2015 although forecasts for this country are highly uncertain and depend on the evolution of the peace process,” the report cautions in part.  

However, experts are also now warning that should the crisis in Burundi escalate, this is likely to dampen the region’s growth prospects this year. This is addition to raising the region’s risk profile and denting investor confidence.

Pockets of instability across the continent is also raising the region’s risk profile.

“(The crisis in) Burundi is very disappointing. I hope those who have the mandate of peace and security can help Burundians bring this crisis to a close. Not only does it have an economic impact but also a human impact- we already have thousands of refugees across the borders and internally displaced people,” Dr Kaberuka said. 

“Whether it is South Sudan or Central African Republic or Burundi …this is damaging from the human development and economic perspective but also the African brand,” he said.

The East African Community Heads of State are this week expected to hold yet another Summit to discuss the Burundi crisis.