The African Development Bank’s biannual study predicts that in 2023–2024, Africa’s economic growth will surpass global projections.

Estimated read time 4 min read

By Samkele Mchunu

African Development Bank’s new report calls for bold policy actions to help African economies mitigate compounding risks

For the following two years, real gross domestic product (GDP) in Africa is expected to rise at a faster rate than the rest of the globe, averaging about 4% in 2023 and 2024.

The African Development Bank Group stated this in Africa’s Macroeconomic Performance and Outlook report for the area, which was made public in Abidjan on Thursday. This is higher than estimated global averages of 2.7% and 3.2%.

The paper provides a thorough regional growth analysis and demonstrates that, despite major challenges brought on by global socio-economic shocks, all five of the continent’s regions are resilient and have a stable medium-term prognosis. In order to handle such dangers, it also recognized them and recommended strong fiscal and monetary policies supported by structural policies.

Every year, the first and third quarters will see the publishing of the Macroeconomic Performance and Outlook report. It is a supplement to the bank’s yearly African Economic Outlook report, which focuses on important new policy issues important to the advancement of the continent.

Following the Covid-19 shock and Russia’s invasion of Ukraine, the research reveals that the expected average growth of real GDP in Africa dropped to 3.8% in 2022 from 4.8% in 2021 due to substantial hurdles. Out of the 54 countries in Africa, 53 saw good growth despite the downturn in the economy. With a stable outlook for the medium term, all five of the continent’s regions continue to be resilient.

The research does, however, provide a warning regarding the outlook in light of the current regional and worldwide threats. Rising food and energy prices, tightening international financial conditions, and the ensuing rise in local debt payment expenses are some of these threats. Threats from climate change are equally daunting because of its detrimental effects on the local food supply and the possibility of policy reversals in nations hosting elections in 2023.

In order to assist African economies in reducing the risks that compound, the paper proposes audacious policy measures at the national, regional, and international levels.

African Development Bank Group President Dr. Akinwumi Adesina remarked during the inauguration that the new report’s release coincided with an era in which African economies were demonstrating their resilience in the face of severe headwinds.

With 54 countries at different stages of growth, different economic structures, and diverse resource endowments, the pass-through effects of global shocks always differ by region and by country. Slowing global demand, tighter financial conditions, and disrupted supply chains therefore had differentiated impacts on African economies,” he said. “Despite the confluence of multiple shocks, growth across all five African regions was positive in 2022—and the outlook for 2023–24 is projected to be stable.”

Niale Kaba, Minister of Planning and Development of Côte d’Ivoire, said: “The release of this report by our bank, the African Development Bank Group, at this time of the year is an excellent opportunity for Africa and its global partners. We need these regular updates to assess our countries’ macroeconomic performance and prospects. This reliable information will help decision-making and risk management for potential investors in Africa.”

Africa’s pre-Covid-19 top five performing economies are projected to grow by more than 5.5% on average in 2023-2024 and to reclaim their position among the world’s 10 fastest-growing economies. These countries are Rwanda (7.9%), Côte d’Ivoire (7.1%), Benin (6.4%), Ethiopia (6.0%), and Tanzania (5.6%).

Other African countries are projected to grow by more than 5.5% in the 2023-24 period. They are the Democratic Republic of Congo (6.8%), The Gambia (6.4%), Mozambique (6.5%), Niger (9.6%), Senegal (9.4%), and Togo (6.3%).

At the launch, economist Jeffrey Sachs, Director of the Center for Sustainable Development at Columbia University commended the report which he said showed that African economies are growing and growing consistently.

Sachs, who is also United Nations Secretary-General Antonio Guterres’ Advocate for Sustainable Development Goals, said: “Africa can and will rise to growth of 7 percent or more per year consistently in the coming decades. What we’ll see, building on the resiliency we see in this report, is a real acceleration of Africa’s sustainable development so that Africa will be the fast-growing part of the world economy. Africa is the place to invest.”

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