As of mid-2024, Africa’s economic status presents a nuanced blend of resilience and recovery amid various global and regional challenges.
The above mentioned affirmation is based on the latest reports by the African Development Bank (AfDB), the International Monetary Fund (IMF), and the United Nations Economic Commission for Africa (UNECA).
Africa’s real GDP growth decelerated to 3.1% in 2023 from 4.1% in 2022, primarily due to geopolitical tensions, notably Russia’s invasion of Ukraine, climate-induced disruptions, and political instability across several nations.
However, the continent is poised for a recovery, with projected growth rates of 3.7% in 2024 and 4.3% in 2025. This effective rebound has been helped by anticipated improvements in global economic conditions and effective domestic policy measures.
Although significant regional disparities, Africa is considered the second-fastest growing region globally. East Africa continues to lead in growth rates due to robust domestic policies and strategic investments. In contrast, regions like Central and West Africa grapple with challenges related to commodity dependence and external shocks. Sub-Saharan Africa, in particular, is expected to see growth rise from 3.4% in 2023 to 3.8% in 2024, reaching 4.0% by 2025.
Despite the positive growth outlook, Africa still faces substantial structural challenges. And to achieve such significant structural transformation, Africa requires strategic investments in key areas such as education, energy, technology, and infrastructure.
The estimated financing gap for these investments is approximately $402 billion annually until 2030.
This gap must be addressed – efficiently working on scaling up domestic resource mobilisation and fostering private sector investment. It is imperative to work relentless on indispensable topics such as: improving public finances, ensuring price stability, implementing structural reforms and securing international support.
Africa’s economic outlook for mid-2024, as said before, can be optimistic, despite significant structural challenges and external shocks. The resilience of African economies and strategic policy interventions offer a pathway to recovery and growth. Effective implementation of recommended policies and sustained international support will be instrumental in achieving long-term sustainable development.
Further Africa
