Johannesburg, 16 February 2024 (TDI): On Friday, the African Development Bank (AfDB) reported that Africa’s economic growth fell to 3.2% in 2023 from 4.1% in 2022. However, the growth has projected an increase this year for all the regions except Central Africa.
According to AfDB political instability, and China’s economic slowdown caused this economic growth to fall. Also, the effects of shocks of COVID-19, and the Russian-Ukraine war contributed to the economic growth to decrease. These events played a vital role in hampering the economic growth of the African region.
According to the AfDB projection in November, the actual growth rate for 2023 fell short of the 3.4% rate. Additionally, the AfDB revised down its growth forecasts for central and north Africa regions. Moreover, a recession in oil-producing Equatorial Guinea and the aftermath of severe flooding in Libya caused AfDB to revise growth estimates.
The bank stated in a report that the shocks affecting African economies since 2020 have harmed growth. They have posed serious implications to the economic development extending into the long term and thus Africa’s economic growth fell.
African Economic Growth in 2023
The AfDB highlighted that 15 African countries achieved economic growth exceeding 5% last year even amidst the challenges faced by the region.
These countries include Ethiopia, Ivory Coast, the Democratic Republic of Congo, Mauritius, and Rwanda. Furthermore, Ethiopia is undergoing external debt restructuring this year.
Nigeria, the largest economy in West Africa, estimates to grow by 2.9%, marking a 0.4 percentage point increase from the last year.
This growth is due to a significantly devalued currency, which has led to increased inflation, producing a cost of living crisis. Meanwhile, in Egypt, the growth expects to reduce growth to 3.7% this year, in comparison to 4% in 2023.
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The bank highlighted that Southern Africa’s slow economic performance is largely due to influence of the persistent economic stagnation in South Africa. The region’s largest economy expects to grow by 1.1% in 2024. It shows a slight improvement from the 0.8% growth recorded in 2023.
The bank has projected increase in growth across all regions in 2024, except for central Africa. Southern Africa is expected to remain the slowest-growing region, with a forecasted growth rate of 2.2%. However, the growth anticipated contrasting in East Africa is at 5.7% rate.
