World Bank raises sub-Saharan Africa growth level

K– The higher growth level will enable countries in the region to register trade/exporting earnings and improve the standard of living among other benefits.

In the latest Africa’s Pulse report, which was presented on April 8 in Washington DC, the World Bank projects that growth will rebound in 2024, rising from a low of 2.6 per cent in 2023 to 3.4 per cent in 2024 and 3.8 per cent in 2025.

Inflation

The World Bank states that while inflation is cooling across most economies, falling from a median of 7.1 to 5.1 per cent in 2024, it remains high compared to pre-COVID-19 pandemic levels.

Additionally, the World Bank stresses that while the growth of public debt is slowing, more than half of African governments grapple with external liquidity problems and face unsustainable debt burdens.

The Africa’s Pulse reveals that public debt in sub-Saharan Africa is expected to decline from 61 per cent of GDP in 2023 to 57 per cent of GDP in 2024. However, the risk of debt distress remains high.

April 2024 Africa’s Edition, which has been themed ‘tackling inequality to revitalise growth and reduce poverty in Africa’ is to be officially released during the World Bank/ International Monetary Fund Spring meeting which starts on April 15 to April 19 and brings together the finance ministers, central bank governors and academia of the 190 member States.

Boost

Overall, the report underscores that despite the projected boost in growth, the pace of economic expansion in the region remains below the growth rate of the previous decade (2000-2014) and it is insufficient to have a significant effect on poverty reduction.

Moreover, due to multiple factors, including structural inequality, economic growth reduces poverty in sub-Saharan Africa less than other regions.

“Per capita GDP growth of 1 per cent is associated with a reduction in the extreme poverty rate of only about 1 per cent in the region compared to 2.5 per cent on average in the rest of the world,” said Dr Andrew Dabalen, World Bank Chief Economist for Africa.