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Africa’s Economic Resilience Draws Global Attention Amid Promising Growth Outlook

May 30, 2025

The 2025 African Economic Outlook (AEO), launched at the Bank’s Annual Meetings in Abidjan, projects GDP growth will rise from 3.3% in 2024 to 4% by 2026, despite ongoing global uncertainty.

(3 Minutes Read)

Africa’s economic potential is gaining renewed global interest as the African Development Bank (AfDB) forecasts the continent could unlock USD 1.43 trillion in domestic resources through reforms and reduced financial leakages. The 2025 African Economic Outlook (AEO), launched at the Bank’s Annual Meetings in Abidjan, projects GDP growth will rise from 3.3% in 2024 to 4% by 2026, despite ongoing global uncertainty.

Titled Making Africa’s Capital Work Better for Africa’s Development, the report urges sweeping reforms in taxation, governance, savings, and natural resource management to maximise Africa’s capital. It forecasts that 21 countries could grow over 5% in 2025, with Ethiopia, Niger, Rwanda, and Senegal exceeding 7%, a level often linked with poverty reduction and inclusive growth.

East Africa is expected to lead regional growth at 5.9%, followed by West Africa at 4.3%, North Africa at 3.6%, Central Africa at 3.2%, and Southern Africa trailing at 2.2%, weighed down by South Africa’s sluggish 0.8% growth projection.

Despite varying regional performance, Africa holds significant untapped capital:

Natural Capital: Home to 30% of global mineral reserves; stands to earn 10% of $16 trillion in green mineral revenues by 2030.
Human Capital: A young population (median age 19) could contribute USD 47 billion to GDP through increased workforce participation.
Financial Capital: Pension assets now total USD 1.1 trillion, while remittances could hit $500 billion by 2035.
Business Capital: Full implementation of AfCFTA could increase exports by $560 billion and income by USD 450 billion by 2035.

However, these opportunities are undercut by major capital outflows—in 2022, while USD 190.7 billion flowed into Africa, USD 587 billion left due to illicit financial flows, corporate profit shifting, and corruption.

The AEO calls for urgent digitalisation of tax systems, broader tax bases, and stronger social contracts to rebuild public trust. It also advocates for natural capital accounting, local value addition, and harmonised regulatory frameworks to deepen financial markets and attract investment.

AfDB’s Chief Economist Kevin Chika Urama stressed that Africa’s progress must be internally driven: “When Africa mobilises its capital effectively, global capital will follow.”

While the continent’s growth outlook is second only to Asia among global regions, the report warns that rising debt costs, inflation, and weak institutions could hinder progress. Interest payments now consume 27.5% of government revenues, up from 19% in 2019, with 15 countries facing double-digit inflation. Ultimately, the AEO offers more than just statistics—it presents a roadmap for African-led, sustainable development, anchored in better capital utilisation, reform, and self-reliance.