The World Bank has revised its economic growth projection for sub-Saharan Africa, decreasing it from 3.4% to 3% for 2024, primarily due to the economic devastation caused by the ongoing civil war in Sudan. Despite this adjustment, growth is expected to remain above last year’s 2.4%, driven by increased private consumption and investment, as noted in the bank’s latest regional economic outlook report, Africa’s Pulse.
Andrew Dabalen, the World Bank’s chief economist for Africa, emphasized that the recovery is progressing, albeit at a slow pace. He stated, “This is still a recovery that is basically in slow gear,” during a recent media briefing. The report also forecasts an uptick in growth to 3.9% in 2025, slightly higher than the previous estimate of 3.8%.
The report indicates that easing inflation in several countries may enable policymakers to lower high lending rates, which have been a barrier to economic activity.
In terms of individual country projections, South Africa’s economy is expected to grow by 1.1% this year, increasing to 1.6% in 2025, a rise from 0.7% in 2023. Nigeria is projected to achieve a growth rate of 3.3% in 2024, with an increase to 3.6% in 2025, while Kenya, the largest economy in East Africa, is likely to expand by 5% this year.
Historically, sub-Saharan Africa averaged annual growth of 5.3% between 2000 and 2014, driven by a commodity boom. However, growth has declined due to falling commodity prices and was further impacted by the COVID-19 pandemic.
Dabalen warned that prolonged economic stagnation could have catastrophic effects, highlighting the urgent need for increased public and private investments across the region. He pointed out that although there has been a slow recovery in foreign direct investment since 2021, it remains insufficient.
High debt servicing costs continue to hinder economic growth, particularly in countries like Kenya, which recently experienced protests against tax hikes. Dabalen attributed the burden of interest payments to a shift by governments toward borrowing from financial markets over the past decade, moving away from the more affordable credit options offered by institutions like the World Bank.