The African Development Bank (AfDB) has downgraded Africa’s growth forecast for the next two years amid what it described as “unprecedented global circumstances” and “seismic shifts in the trade policies of major economies.”
Significant aid cuts will also hit low-income countries on the continent, Tuesday’s African Economic Outlook report warned.
Overall, the bank is projecting growth of 3.9 percent for 2025 and 4 percent for 2026 – a downgrade of 0.2 and 0.4 points respectively.
Despite ongoing uncertainty, 21 African countries are still expected to see economic growth of more than 5 percent this year, resilience the bank ascribes to effective domestic reforms, relative diversification and improved macroeconomic management over the last decade.
The AfDB urged member countries to continue to realise their development potential through strategic investments, policy support, and innovative financing mechanisms.
Institutions, governance and the rule of law are vital to managing Africa’s capital, the report concludes, calling for transparent public finances, secured property rights and predictable legal systems.
