Afreximbank: Africa’s economies expected to grow by 3.8% in ’24

Africa’s economies are expected to grow by 3.8 per cent in 2024, exceeding the global forecast of 3.2 per cent, with projections increasing to 4 per cent in 2025.

Yemi Kale, African Export-Import Bank (Afreximbank) Group Chief Economist, highlighted that global challenges affecting Africa’s trade undermined the performance of the continent’s trade, which contracted by 6.3 per cent in 2023 after a 15.9 per cent expansion in 2022, while intra-African trade grew by 3.2 per cent.

Kale emphasised the potential of the African Continental Free Trade Area (AfCFTA) to shield Africa from global shocks, noting significant untapped intra-African trade potential, particularly in machinery, electricity, vehicles, and food products.

Moreover, the reports underscore various risks faced by African economies, including rising sovereign debt, adverse terms-of-trade shocks, geopolitical tensions, domestic political instability, high commodity prices, inflation, and food insecurity.

Despite the challenges of 2023, the outlook for 2024 remains positive, with expected improvements in macroeconomic indicators and higher growth than the global average, coupled with a projected decrease in inflation.

Additionally, the African Trade Report 2024 titled ‘Climate Implications of the AfCFTA Implementation’, Kale reviews the potential of the AfCFTA to address developmental goals and climate change concerns simultaneously. While acknowledging ongoing debates about its environmental impact, he suggests that emphasising intra-African trade through the AfCFTA could mitigate carbon emissions.

Attribution: Afreximbank’s African Trade Report and African Trade and Economic Outlook Report at AAM 2024.