Sub-Saharan Africa Growth Expected to Rise, But Poverty Reduction Remains a Challenge



Thank you for reading this post, don't forget to subscribe!

According to the World Bank’s biannual Africa’s Pulse report released on Monday, economic growth in Sub-Saharan Africa is projected to increase over the next two years, but it may not have a significant impact on poverty reduction in the region.

The report forecasts that the region’s economy will expand by 3.4% in 2024 and 3.8% in 2025, up from 2.4% in 2023. This growth is attributed to falling inflation, which boosts private consumption. However, the recovery is described as fragile, with many countries still grappling with the aftermath of COVID-19, Russia’s war in Ukraine, drought, and conflict.

Despite the anticipated growth, the pace of economic expansion remains slow, and per capita GDP growth is insufficient to substantially reduce poverty. In Sub-Saharan Africa, a 1% increase in per capita GDP is associated with only a 1% reduction in poverty, compared to 2.5% in other parts of the world.

While South Africa’s growth rate is expected to double in 2024 to 1.2%, Angola’s is forecasted to increase to 2.8% from 0.8% last year, primarily driven by the non-oil sector. In contrast, the East African Community region is projected to grow by 5.3% this year, fueled by strong growth in countries like Kenya, Rwanda, Uganda, and the Democratic Republic of Congo.

However, challenges persist in West Africa, where Nigeria’s economy is forecasted to grow by 3.3% this year, below its long-term average. Additionally, several countries in the region, including Zambia, Ghana, and Ethiopia, have faced external debt defaults in recent years.

While the report notes a slight improvement in Sub-Saharan Africa’s public debt-to-GDP ratio, with a projected decrease from 61% in 2023 to 57% this year, over half of the countries in the region are still at high risk of debt distress. External borrowing costs remain high compared to pre-pandemic levels, raising concerns about potential financial crises and defaults in the future.

Discover more from Naija247news

Subscribe to get the latest posts to your email.

Emman Tochi
Emman Tochi
Emma Tochi is Naija247news Media Northern Bureau Chief, he's based in FCT Abuja. He overseas the northern operations of this business media

Share post:



More like this

House Of Reps Urge FG, Army To Re-open Banex Plaza

May 23, 2024. Azonuchechi Chukwu. The House of Representatives on Thursday...

Diesel Prices in Nigeria Surge by 68.01% Year-on-Year, Reaching N1,415.06 per Litre in April 2024

The National Bureau of Statistics (NBS) released its latest...

Kanayo O. Kanayo fumes over ‘money rituals’ ban in Nollywood

May 23, 2024. Azonuchechi Chukwu. Veteran Nollywood actor, Kanayo O. Kanayo...

U.S Backed Kenya-Haiti Deployment Faces Equipment Shortages As Criticism Mounts

Kenya-Haiti Deployment: A Bid to Avert Haiti's Impending...

Discover more from Naija247news

Subscribe now to keep reading and get access to the full archive.

Continue reading