TLDR
- World Bank revises 2024 Sub-Saharan Africa economic growth forecast to 3% due to ongoing civil war in Sudan impacting regional activity.
- Conflict in Sudan displaces 11 million people and causes economic collapse, with Sudan's economy projected to contract by 15.1% in 2024.
- Excluding Sudan, Sub-Saharan Africa expected to grow by 3.5% next year, with forecasted average growth of 4% in 2025 and 2026 driven by private consumption and investment.
The World Bank has revised down its 2024 economic growth forecast for Sub-Saharan Africa to 3%, from an earlier estimate of 3.4%, primarily due to the ongoing civil war in Sudan, which has significantly impacted regional activity. The region's economy expanded 2.4% in 2023.
The conflict in Sudan, which erupted 18 months ago, has displaced 11 million people and led to the collapse of economic activity. The World Bank expects Sudan's economy to contract by 15.1% in 2024, with a modest recovery projected for 2025.
Excluding Sudan, Sub-Saharan Africa is expected to grow by 3.5% next year, according to Andrew Dabalen, the World Bank's chief economist for Africa. Growth for the region is forecast to pick up to an average of 4% in 2025 and 2026, driven by private consumption and investment, aided by slowing inflation and lower interest rates.
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Key Takeaways
Sub-Saharan Africa's economic outlook has been hampered by Sudan's civil war and high debt burdens, limiting investments in critical areas like education and infrastructure. Despite the improvement, the region's recovery remains sluggish, with income per capita still below pre-pandemic levels. Extreme poverty persists, affecting 36.5% of the population, with 464 million people living on less than $2.15 per day. The World Bank recommends urgent fiscal reforms, reducing deficits, and prioritizing investments in human capital to foster long-term growth and reduce inequality.
