Article :
Sub-Saharan Africa: Economic growth in crisis
The economic situation in sub-Saharan Africa faces a serious challenge. Following rising political instability, weak growth in the region’s major economies, climate shocks and continued global growth uncertainty, the region’s economic growth is expected to experience a significant deceleration.
According to the Africa Pulse report published on October 23, 2023, the region’s economic growth is expected to fall from 3.6% in 2022 to just 2.5% in 2023. This deceleration is expected to continue in 2024 with growth of 3.7%. , then increase slightly to 4.1% in 2025.
This deceleration in economic growth is particularly concerning because per capita growth has not increased since 2015. The report highlights that the sub-Saharan Africa region is expected to experience an average annual per capita contraction of 0.1% over the 2015 period. -2025, marking a decade of lost growth. This situation is largely due to the fall in commodity prices in 2014-2015.
The report also highlights regional disparities within sub-Saharan Africa. The real gross domestic product (GDP) of the Eastern and Southern Africa sub-region is expected to grow by 1.9 percent in 2023, while that of the East and Southern Africa sub-region West and Central is expected to reach 3.3%.
In addition to decelerating economic growth, the region also faces challenges such as inflation, debt overhang and low job creation. Although inflation has fallen slightly, it still remains above the Central Banks’ objectives. In addition, over-indebtedness weighs heavily on the region’s economies.
Low economic growth has also led to slow poverty reduction and low job creation. The report highlights that the share of urban employment in the working age population has remained stagnant for two decades. Additionally, the gender pay gap problem creates misallocation of labor, leading to a loss of potential productivity.
To meet these challenges and revive economic growth, the report proposes several directions. It suggests countries in the region to support demand-driven skills, promote organizational transformation of work, ensure political stability and strengthen institutions to support the market economy, and finally achieve inclusive growth through financial stabilization and debt reduction.
In conclusion, the economic situation in sub-Saharan Africa is currently facing a serious challenge with deceleration in economic growth, persistent inflation, debt overhang and weak job creation.. To overcome these challenges, it is imperative that countries in the region implement structural reforms and effective economic policies to boost growth and ensure future prosperity.