The African Export-Import Bank (Afreximbank) launched its African Trade Report 2024 and African Economic Outlook Report 2024 during the 2024 Afreximbank Annual Meetings (AAM) in Nassau, Bahamas.
The latest report forecasts that African economies will grow on average by 3.8% in 2024 – slightly above the projected global growth of 3.2% – before increasing by 4% in 2025. Titled « A Resilient Africa: Fostering Growth in a Turbulent World, » the report provides an analysis of the economic environment, trade patterns, debt scenarios, and future projections for African economies.
The current global challenges have compromised the performance of African trade, which decreased by 6.3% in 2023
« The current global challenges have compromised the performance of African trade, which decreased by 6.3% in 2023, » said Dr. Yemi Kale, Chief Economist of the Afreximbank Group and Managing Director of Research and International Cooperation. He added, « Our analysis in the report also revealed significant untapped potential in intra-African trade, especially concerning machinery, electricity, motor vehicles, and food products. »
The report also revealed that African economies face several downside risks, including increasing levels of sovereign debt and associated sustainability risks, excessive exposure to adverse terms-of-trade shocks, escalating geopolitical tensions in some cases, volatile domestic political environments in certain African countries, high commodity prices and inflationary pressures, and potential food insecurity.
Positive outlook despite the challenging economic environment of 2023
The outlook for the African continent in 2024 remains positive despite the challenging economic environment of 2023. Most macroeconomic indicators are expected to improve in 2024 and 2025. Continent-wide growth is projected to surpass the global average, and although inflation is currently high, it is expected to decrease, with this downward trend continuing into 2025.
In the African Trade Report 2024, titled « Climate Implications of AfCFTA Implementation, » Dr. Kale stated that the report concludes that the AfCFTA offers a path to achieving the developmental goals of African nations while also addressing climate change concerns.
AfCFTA can result in potential gains through increased intra-African trade and investment
Dr. Kale indicated that while the benefits of the AfCFTA can be seen, the debate on its impact on climate change is still ongoing. He said, « One group believes that increased urbanization and industrialization associated with the AfCFTA will worsen carbon emissions, and the second group believes that by emphasizing intra-African trade and reducing extra-African trade, carbon emissions will be eliminated through shorter shipping distances. »
Overall, the report states that optimizing the AfCFTA can result in potential gains through increased intra-African trade and investment, creating economic prosperity and fulfilling the vision of the founding fathers.
Read the report : www.afreximbank.com
