African economic growth set to rebound despite persistent challenges

Africa’s gross domestic product is projected to grow by 3.8% in 2025 and 4.1% in 2026, establishing the continent as the second-fastest growing global region, according to economic forecasts released during the 57th Conference of African Ministers of Finance, Planning, and Economic Development in Addis Ababa.

Economic experts acknowledge African economies’ remarkable resilience but caution that current growth trajectories remain insufficient to drive widespread social development across the diverse continent. While decreasing inflationary pressures have bolstered economic performance, structural challenges persist in translating growth into meaningful poverty reduction.

Intra-African trade presents a complex picture, showing increased dynamism and diversification in certain regions while its overall contribution to continental growth has diminished compared to previous periods. This trend highlights the ongoing challenges in leveraging regional trade as a consistent economic driver.

Despite measurable progress in reducing extreme poverty in alignment with global trends, poverty rates remain disproportionately elevated across most African regions. North Africa stands as the notable exception, having achieved more substantial poverty reduction than other parts of the continent.

Climate change emerges as a growing threat to Africa’s development prospects, with experts forecasting negative impacts on agricultural productivity throughout coming decades. These climate-related disruptions are expected to exacerbate food insecurity across numerous regions, potentially undermining economic gains.

The continental economic forecast underscores Africa’s progress amid challenging global conditions but emphasizes the urgent need for accelerated, inclusive growth strategies that can address persistent social inequalities while building climate resilience into national development frameworks.