Sub-Saharan Africa’s economic trajectory shows renewed promise as the World Bank revised its growth projections upward to 3.8% for this year, marking a significant improvement from earlier estimates, reported Reuters. The adjustment, announced in the institution’s biannual Africa Pulse report, reflects stabilizing currency markets and declining inflation across the region’s 47 economies.
The revision from April’s 3.5% forecast comes as countries like Ethiopia witness improved foreign exchange conditions, creating opportunities for central banks to implement strategic interest rate reductions. These developments have sparked renewed private sector confidence, with consumption and investment patterns showing measurable recovery.
Andrew Dabalen, the World Bank’s chief economist for Africa, highlighted the dramatic shift in economic fundamentals during a press briefing, relayed by Reuters. Median inflation has fallen below 4%, while currencies that previously experienced sharp declines against the U.S. dollar have stabilized. The weakening greenback, down nearly 10% since January, has created additional breathing room for emerging markets across the continent.
Major economies including Nigeria, Ethiopia, and Côte d’Ivoire received upgraded forecasts, contributing to the overall regional momentum. The bank projects growth will accelerate to 4.4% annually over the next two years, with 30 of 47 regional economies showing improved prospects.
Dabalen; however, warned that failure to address unemployment could fuel further unrest. He urged governments to support SMEs and build a more inclusive growth model that can sustain long-term prosperity.