Africa to Remain Fastest Growing Region in 2024: Macroeconomic Performance, Outlook Report

Addis Ababa, February 16/2024 (ENA)  Africa is projected to remain the fastest-growing region after Asia by registering 3.8% growth in 2024, Africa's Macroeconomic Performance and Outlook report revealed today.

Speaking at the launching ceremony of the report, African Development Bank (AfDB) President Akinwumi A. Adesina said that Africa is projected to remain the fastest growing region in the world after Asia, exceeding the global average of 3% in 2023.

“Despite the challenging global and regional economic environment, 15 African countries have posted output expansions of more than 5%. (And) the report shows that Africa is projected to remain the fastest growing region in the world after Asia, exceeding the global average of 3% in 2023. 

“It is forecasted that Africa will account for 11 out of the 20 fastest growing economies in the world in 2024. We project that growth on the continent will rebound to 3.8% in 2024,” the president added. 

The long-term effects of the pandemic, the impact of Russia-Ukraine conflict on food and energy prices, climate change, extreme weather events, and China’s slow recovery and property market downturn are among the factors to the downturn in Africa.

According to Adesina, the growth is expected to be broad-based although domestic supply bottlenecks such as shortfalls in electricity generation are still lingering.

The report attributes this strong growth to increased infrastructure investment, a recovery in tourism, a robust mining sector, and successful economic diversification efforts.

East Africa, aided by deeper regional integration and strategic public spending to improve infrastructure investment growth is projected to pick up to 5.1 percent in 2024 and 5.7 percent in 2025.

North Africa’s growth is projected to remain steady at 3.9% in 2024, with a slight improvement to 4.1% in 2025, while Central Africa expects a moderate growth to 3.5% in 2024 with a possible recovery in 2025 due to projected increases in private consumption, mining investments, and improved competitiveness, the report stated. 

Southern Africa, on the other hand, anticipates sluggish growth rates of 2.2% and 2.6% in 2024 and 2025, respectively. And West Africa is set to experience a pick-up in growth, with rates expected to reach 4% and 4.4% in 2024 and 2025, respectively, the report added.

AfDB President Adesina noted that boosting Africa’s growth momentum requires bold policies. Tackling persistent inflation will need a mix of restraining monetary policy, coupled with fiscal consolidation and stable exchange rates.

But structural reforms and strategic industrial and agricultural policies remain the key to accelerate economic diversification and strengthen the export sector. It is possible to reinforce structural transformation by investing in human capital, he underscored.

Rising costs of living, weakening economic growth, climate change effects, scarcity of concessional resources, and the lingering impacts of health pandemic, conflicts, and geopolitical tensions are among the challenges faced by the continent. 

The president finally pointed out that Africa requires larger pools of financing and several policy interventions, including domestic resource mobilization, greater focus on lending in local currencies, managing and deriving natural resources, accelerated debt restructuring, and re-channeling of Special Drawing Rights (SDRs) to African Development Bank in order to boost growth.