Africa to become world’s fastest-growing region, outpacing Asia — report
The African Continental Free Trade Area (AfCFTA) will facilitate economic growth and development on the continent that is projected to become the world’s fastest-growing region, with six out of the ten fastest-growing economies in 2023 being African countries, according to a new report by the Mo Ibrahim Foundation.
The AfCFTA presents a huge opportunity for Africa, wits its ready market of over 1.4 billion people surpassing that of the European Union and Asia, the report states. Africa’s population is the world’s youngest and is projected to grow significantly from 2060, and the continent’s natural resources, including critical minerals for renewable technologies, make it indispensable to a green global economy.
The report also argues that Africa’s natural resources are indispensable for green global economy, as the continent accounts for 30% of the world’s mineral reserves, many of which are critical to renewable and low-carbon technologies.
The size of the AfCFTA market has surpassed the EU single market, US-Mexico-Canada Agreement (USMCA) and Southern Common Market (MERCOSUR) combined, the report says. The report, based on the United Nations Department of Economic and Social Affairs (UNDESA), highlights that currently the population in Africa is already twice that of Europe, with over 2.2 billion people.
The report projects that Africa’s share of the world population will grow from 18% to 38% between 2023 and 2100. It also notes that while the EU’s share of Africa’s export market has dropped by a quarter since 2000, China’s share has increased five-fold. Asia now represents almost 42% of Africa’s exports and over 45% of its imports, above Europe in both cases.
While highlighting the bright future awaiting Africa, the report by Mo Ibrahim Foundation also points to some challenges, most notably the nature of the current global financial system that does not meet Africa’s needs. More than a third of Africa’s public external debt, 70% of which is US dollar-denominated, is owed to the private sector, with multilateral lenders such as the World Bank, International Monetary Fund and the African Development Bank being owed the next most.