The World Bank has lowered its economic growth forecast for sub-Saharan Africa for 2024 to 3 per cent from an earlier 3.4 per cent.
The decision, contained in the bank’s latest regional economic outlook report, Africa’s Pulse, was mainly attributed to the destruction of Sudan’s economy in a civil war.
It, however, projected that growth is expected to remain comfortably above last year’s 2.4 per cent, citing higher private consumption and investment.
Andrew Dabalen, chief economist for the Africa region at the World Bank, told a media briefing on Monday that “This is still a recovery that is basically in slow gear.”
The report forecast 2025 growth at 3.9 per cent, above its previous prediction of 3.8 per cent. Moderating inflation in many countries will allow policymakers to start lowering elevated lending rates, the report said.
The report noted, however, that the growth forecasts still face serious risks from armed conflict and climate events such as droughts, floods, and cyclones.
The World Bank added that without the conflict in Sudan, which devastated economic activity and caused starvation and widespread displacement, regional growth in 2024 would have been half a percentage point higher and in line with its initial April estimate.
Growth in the region’s most advanced economy, South Africa, is expected to increase to 1.1 per cent this year and 1.6 per cent in 2025, from 0.7 per cent last year.
According to the report, Nigeria is expected to grow at 3.3 per cent this year, rising to 3.6 per cent in 2025, while Kenya, the richest economy in East Africa, is likely to expand by 5 per cent this year.
The sub-Saharan Africa region grew at a robust annual average of 5.3 per cent in 2000-2014 on the back of a commodity Supercycle, but output started flagging when commodity prices crashed. The slowdown was accelerated by the COVID-19 pandemic.
“Cumulatively, if that were to continue for a long time, it would be catastrophic,” Dabalen warned.
