The African Development Bank said that economic growth in Africa fell to 3.2% last year from 4.1% in 2022, but it expected higher growth this year in all regions except Central Africa.
The bank said that political instability and the economic slowdown in China exacerbate the impact of previous shocks such as the “Covid-19” pandemic and the Russian war on Ukraine.
This came below the bank’s expectations issued last November, which heralded growth of 3.4% in all of 2023. It also lowered its estimates for regional growth in Central and North Africa in light of the stagnation of the economy of oil-producing Equatorial Guinea and the repercussions of devastating floods in Libya.
Traumas
The bank added in its report that “the shocks that have afflicted African economies since 2020 have harmed growth, with long-term repercussions.”
He explained that despite the shocks rocking the region, 15 African countries recorded economic growth of more than 5% last year, including Ethiopia, which is restructuring its foreign debt, Ivory Coast, the Democratic Republic of the Congo, Mauritius, and Rwanda.
The bank expects growth to accelerate in all regions except Central Africa in 2024, while the southern part of the continent remains at the bottom of the list with growth of 2.2% compared to 5.7% in East Africa.
The bank said that the slow performance reflects the ongoing economic stagnation in South Africa, as the largest economy in the region is expected to grow 1.1% in 2024, up from 0.8% last year, while elections are expected to be held in the country this year.
Disappointing situation
The bank added, “This disappointing economic situation exacerbated high unemployment, poverty, and inequality in the country, and prevented it from reaping the benefits of democracy during the 30 years that followed the end of white minority rule.”
The bank’s forecasts indicate that Nigeria (West Africa’s largest economy) can record growth of 2.9% in 2024, an increase of 0.4 percentage points over last year, as the sharp devaluation of the currency led to a rise in inflation, which exacerbated the crisis of high costs of living.
In Egypt, high inflation and a shortage of foreign currency are expected to decline growth to 3.7% this year compared to 4% in 2023.
