Despite several challenges, including rising inflation, climate change, geopolitical tensions, food insecurity and rising debt, Africa’s economies have continued to grow faster than the global average of three per cent demonstrating resilience.
The President of the African Development Bank Group, Dr. Akinwumi Adesina disclosed this during the bank’s annual luncheon for ambassadors and heads of diplomatic missions as well as representatives of international organisations based in Abidjan, Cote d’Ivoire.
Adesina said, “It is forecasted that Africa will account for 11 out of the 20 fastest-growing economies in the world in 2024,” adding that 15 African countries have posted output expansions of more than five per cent.
Analysis of growth trajectory across some African economies showed that Nigeria’s Gross Domestic Product (GDP) grew by 3.46 per cent year-on-year in real terms in the fourth quarter of 2023, the National Bureau of Statistics (NBS) has said.
The NBS said this growth rate is lower than the 3.52 per cent recorded in the fourth quarter of 2022 and higher than the third quarter of 2023 growth of 2.54 per cent.
Ghana’s economic growth slowed to two per cent year-on-year in the third quarter of 2023 from 3.2 per cent in the previous quarter, driven by a decline in the industrial sector, its statistics agency said.
The West African country is grappling with its worst economic crisis in a generation, with a sharply weaker cedi currency and double-digit price rises for consumers.
Kenya’s economy grew 5.9 per cent year-on-year in the third quarter of last year, compared to 4.3 per cent growth in the same quarter of 2022, official data showed.
“This growth was mainly supported by a rebound in agricultural activities that had contracted in 2022,” the Kenya National Bureau of Statistics (KNBS) said in a report.
During last week’s African Union Summit in Addis Ababa, the African Development Bank launched its African Macroeconomic Performance and Outlook Report for 2024. The report shows that Africa is projected to remain the fastest-growing region in the world, after Asia, exceeding the global average of three per cent in 2023.
“At the African Development Bank, all our work is to support the countries to build resilience, whether it be to external economic shocks, climate shocks, or changes in global interest rates that have continued to put pressure on debt service capacities and depreciation of currencies driving up inflation,” Adesina said.
The Bank resumed the diplomatic luncheons after nearly five years due to the Covid-19 pandemic. It was also the first diplomatic luncheon since 2019, months before the Bank’s shareholders collectively agreed to a significant increase of the capital of the African Development Bank by 150 per cent, moving it from $93 billion to $208 billion—the largest capital increase in the history of the Bank since 1964.
In addition, Adesina said, the 16th replenishment of the African Development Fund received a record $8.9 billion provided by donor countries, the largest ever replenishment in the history of the Fund since its establishment in 1973.
The African Development Fund will be able to do even more after the Bank Group governors authorized the Fund to use its equity in the capital markets. “This landmark decision, taken by our governors during the 2023 Annual Meetings held in Sharm El Sheikh, Egypt, will allow the African Development Fund to raise an additional $27 billion to scale up support for the economic development of the 37 low-income countries,” he noted.
He also spoke about the Bank’s work the Inter-American Development Bank on how to better optimise the use of the Special Drawing Rights (SDRs) by rechannelling them from SDR-rich countries to the African Development Bank. SDR-rechanneling to the African Development Bank will be leveraged by 3-4 times.
Adesina said the Bank Group’s Boards of Directors approved last year 159 operations, worth $10 billion for countries, the second-highest level of financing in the Bank’s history.
Overall, he said, the operations of the Bank have impacted directly on the lives of 400 million people over the last seven years.
Other achievements over the period include financing of over $44 billion in support of infrastructure, making the Bank the largest multilateral financier of infrastructure in Africa.
Infrastructure development includes, among others, the construction of mega bridges such as the Senegambia which now links Gambia and Senegal.
The Bank also provided $500 million to support the development of the Lobito Corridor which will link Angola, Zambia and the Democratic Republic of Congo in close partnership with the United States Development Finance Corporation and the Africa Finance Corporation.
