As the global economy remains fragile—marked by persistent geopolitical tensions, commodity price volatility, and a potential slowdown in China and the United States—Africa shows encouraging signs of resilience and economic recovery. This is highlighted in the 2025 African Trade and Economic Outlook (ATEO) report, published by Afreximbank.
The report forecasts a real GDP growth for Africa of 4% in 2025, continuing an upward trend toward 4.1% in 2026 and 4.2% in 2027. This is a remarkable international performance, driven by growing global demand for African exports, a trend toward disinflation, and the implementation of structural reforms aimed at diversifying the continent’s economies.
41% of African economies are expected to register growth of at least 5%, nearly double the global average of 21%
The report highlights a significant point: « 41% of African economies are expected to register growth of at least 5%, nearly double the global average of 21%. » This figure illustrates Africa’s growing role as a global growth driver.
However, this momentum is not without risks. The report’s authors note that « the economic slowdown in the United States and China could also impact international financial conditions and demand for African resources. » In addition, internal factors such as conflicts, political instability, and increasingly severe climate change effects raise concerns.
The AfCFTA represents an opportunity to strengthen economic integration and intra-African trade, reducing vulnerability to external shocks in the medium term
Conversely, several factors could further support this growth. The anticipated decline in global interest rates, expected as early as 2025 if geopolitical tensions stabilize, could widen access to financing for African countries. The report also emphasizes the importance of the African Continental Free Trade Area (AfCFTA), which, according to the authors, “represents an opportunity to strengthen economic integration and intra-African trade, reducing vulnerability to external shocks in the medium term.”
Ensuring debt sustainability requires improved public spending efficiency and prioritization of growth-oriented investments
In the face of uncertainty, the authors recommend adopting proactive monetary policy, strengthening resilience to climate and geopolitical shocks, supporting domestic consumption, and developing services. Over the longer term, it is essential to invest in economic diversification, human capital development, and improved public governance.
Africa still suffers from a heavy dependence on raw materials. The report calls for “accelerating the structural transition toward a more diversified and resilient economy” to reduce exposure to global price fluctuations. Another major concern: debt sustainability. Several African countries allocate more than 50% of their public revenues to debt servicing, which hinders productive investment. To address this, “ensuring debt sustainability requires improved public spending efficiency and prioritization of growth-oriented investments.”
Improving human capital is also deemed essential for the continent’s economic transformation. The report recommends increased investment in health and education, particularly in science and technology sectors. “Strengthening training in science and technology facilitates skills development and talent allocation, both essential for structural transformation,” the report reads.
Addressing inequalities as part of the sustainable development goals, by ensuring equitable access to quality education, healthcare, energy, transport infrastructure, and financial services
Africa’s economic growth has yet to significantly improve living conditions for many people, due to insufficient progress in poverty reduction. To remedy this, the report proposes “improving the provision of infrastructure and basic public services” and “addressing inequalities as part of the sustainable development goals, by ensuring equitable access to quality education, healthcare, energy, transport infrastructure, and financial services.”
Finally, the environment presents a growing challenge. The rise in extreme weather events and ecosystem degradation threaten the foundations of growth. According to Afreximbank, “the promotion of green growth must be integrated into coherent policy frameworks that take into account the continent’s needs and challenges.”
In this mixed context, Africa is moving forward with determination. By capitalizing on its strengths—youth, resources, regional integration—and investing in structural transformation, the continent could play an even more central role in the global economy. The ATEO 2025 report charts a realistic yet ambitious course to make this vision a reality.
Read the full report : https://media.afreximbank.com/afrexim/African-Trade-and-Economic-Outlook-ATEO-2025-1.pdf
