Africa set to be second-fastest growing region after Asia: AfDB’s African Economic Outlook report

Addis Ababa, May 26, 2023 (FBC) – Africa is set to be the second-fastest growing region in the world after Asia in 2023-24, demonstrating the resilience of its economy despite dealing with multiple global shocks.

But the projected growth will depend on global conditions and the continent’s ability to bolster its economic resilience, the African Development Bank’s 2023 African Economic Outlook report has found.

The report, launched forecasts that Africa will consolidate its post-Covid-19 pandemic recovery to 4.3% GDP growth in 2024 from 3.8% in 2022. Some 22 countries will record growth rates above 5%, it says.

It recommends robust policy actions, including incentivizing green industries and providing guarantees at scale to de-risk private sector investments in managing natural capital across the continent.

Unveiling the 220-page report, African Development Bank Group President Akinwumi Adesina said African countries must do more, including mobilizing more domestic resources and restructuring debt to withstand global headwinds.

“African economies are moving in the right direction,” Adesina said, noting that five of the six pre-pandemic top-performing economies are set to be back in the league of the world’s 10 fastest-growing economies in 2023–2024.

The bank chief also pointed out that monetary tightening in the United States and Europe has led to rising interest rates that have compounded debt service payments for African countries.

Admassu Tadesse, President and Group Managing Director of Eastern and Southern Trade and Development Bank, said he found as striking the report’s focus on the scope to leverage natural capital.

“For this report to be highlighting that in Sharm El Sheikh where COP27 took place, I think it is timely,” he stressed.

The African Economic Outlook report is the Bank Group’s flagship annual publication that provides compelling, up-to-date evidence and analysis to inform policy decisions.

While highlighting the challenges, the 2023 African Economic Outlook mainly focuses on opportunities to unlock private investments and know-how and tap the continent’s vast natural capital to combat climate change and spur the transition to green growth.