Sub-Saharan Africa’s Growth Stunted by South Africa, Nigeria, Angola

The World Bank predicts a modest but notable increase in economic activity across Sub-Saharan Africa, projecting growth to rise from 3.3% in 2024 to 3.5% in 2025, with expectations to further accelerate to 4.3% by 2026-27. This forecast brings a glimmer of hope, yet many underlying challenges remain.

According to the latest Africa’s Pulse report, the growth potential of the region is heavily influenced by a few heavyweight economies. Angola, Nigeria, and South Africa, among the largest economies on the continent, are reportedly dragging down overall growth. So, what does this mean for smaller nations that are often overlooked in such metrics? They might find an unexpected opportunity to shine.

When looking closely at the data, we see that if we exclude these three major players, the rest of Sub-Saharan Africa is poised for a significant expansion of 4.6% by 2025, accelerating even further to 5.7% in the following years. However, this positive outlook exists amidst a sea of uncertainty. The question lingers: will global policy shifts cast a shadow on this promising trajectory?

One insightful observer remarked, “Sub-Saharan African economies will navigate an uncertain landscape amid greater policy uncertainty, which may lead to changes in the world trade order; ongoing geopolitical shifts that may impact commodity prices, disrupt international relations, and yield further fragmentation; reduced foreign aid budgets worldwide; and challenges posed by extreme weather events.” This highlights a stark reality—economic growth isn’t just about numbers; it’s intimately connected to the global ecosystem.

Inflation Cooling Across the Region but Remains Uneven

Turning to inflation, the report indicates an encouraging trend—about 70% of Sub-Saharan African countries observed a decline in inflation rates in 2024. This decline can be attributed to factors such as enhanced currency stability, tighter monetary and fiscal policies, and improvements in global supply chains. However, as with economic growth, the picture varies significantly across the landscape.

Out of 47 countries surveyed, 14—including Angola, Ethiopia, Ghana, Malawi, Nigeria, Sudan, and Zimbabwe—still grapple with double-digit inflation rates. For these nations, the struggle is real. Imagine the impact on everyday life; families striving to make ends meet are acutely aware of rising costs. Can we expect them to find relief anytime soon?

Encouragingly, the World Bank projects that by 2027, the number of countries facing inflation above 10% will drop to six. “As inflation cools down and converges to targets, and financial conditions—both global and domestic—remain accommodating, it is expected that household consumption and investment will catalyze the region’s growth acceleration,” the report suggests. Still, the need for caution lingers. Will these positive trends endure in the face of possible global economic shifts?

Poverty Remains High

The World Bank also underscores a pressing concern: despite anticipated economic growth, the strides to alleviate extreme poverty are insufficient. The reality is sobering: projected real income per capita in 2025 is expected to remain about 2% below its 2015 peak. It begs the question—how do we address the intrinsic barriers that keep people trapped in poverty?

While per capita growth is expected to rise at an average annual rate of 1.8% between 2025 and 2027, the anticipated decline in poverty is likely to be modest at best. In fact, the World Bank forecasts that poverty, defined at $2.15 per person per day in 2017 international purchasing power parity, will peak at 43.9% in 2025 before slightly decreasing to 43.2% by 2027. This slow descent from such staggering heights poses some critical challenges. Can we truly celebrate progress when so many are still struggling?

Factors contributing to this persistent struggle include limited investments in income-generating sectors for the impoverished, lingering effects of inflation, and a probable reduction in global donor aid. These complexities emphasize the need for targeted, innovative solutions that can create sustainable pathways out of poverty.

In conclusion, while the World Bank offers insights on the economic landscape of Sub-Saharan Africa that could instill hope, we must not overlook the nuances that paint a more complicated picture. The journey toward sustainable growth is not merely about increasing numbers; it’s a narrative woven with human stories, economic cycles, and policy decisions that impact lives daily. So, as we reflect on these projections, let’s ask ourselves: how can we contribute to fostering a resilient future for all?

Edited By Ali Musa
Axadle Times International–Monitoring.