Economic growth in Sub-Saharan Africa is showing signs of resilience despite global economic uncertainties and limited fiscal flexibility. The region's growth is projected to reach 3.5% in 2025, potentially rising to 4.3% between 2026 and 2027. This trend is attributed to increased private consumption and investments driven by cooling inflation and stabilized currencies. The median inflation rate in the region has decreased from 7.1% in 2023 to 4.5% in 2024.
Despite these positive indicators, the growth remains insufficient to significantly reduce poverty and meet population aspirations. This concern is highlighted in the 31st edition of Africa’s Pulse, focusing on improving governance and delivering services to African populations. Real income per capita in 2025 is projected to be approximately 2% below its peak in 2015. Resource-rich countries and those experiencing fragility, conflict, and violence are growing slower compared to more diversified economies, and the region is facing challenges in creating adequate jobs for its young populace.
"There is a growing gap between people’s aspirations for good jobs and functioning public services and often sub-optimal markets and institutions," stated Andrew Dabalen, World Bank Chief Economist for the Africa Region. "Urgent reforms, backed by more competition, transparency and accountability, will be key to attract private investments, increase public revenue, and create more economic opportunity for millions of Africans entering the workforce each year."
Sub-Saharan Africa is also dealing with heightened uncertainties due to shifts in trade dynamics, regional conflicts, and climate change impacts on populations and agriculture. Although the effects of policy changes will unfold over time, African economies have the potential to liberalize and diversify their markets. This includes leveraging the African Continent Free Trade Area (AfCFTA) to boost regional trade, expand economic activities, and provide employment opportunities for young people.
The report offers policy recommendations for African governments to sustain growth and rebuild trust in a volatile environment. Facing high debt and declining global aid, countries are encouraged to increase the efficiency of government spending to enhance access to essential services such as health, education, water, and electricity. This effort would strengthen the relationship between governments and taxpayers. Improved public services, a fair tax system, stronger accountability, and clear market rules will also support business competition, growth, and job creation.