Debt and Fiscal Pressures

While growth is holding steady, debt vulnerabilities remain elevated.

The report highlights that 23 countries in the region are currently at high risk of or already in debt distress—almost triple the number a decade ago.

External debt service payments have risen sharply, averaging about 2% of GDP in 2024, constraining fiscal space for public investment in infrastructure and social sectors.

Labour Market and Demographic Shifts

Sub-Saharan Africa’s population continues to expand rapidly, with the working-age population projected to increase by more than 600 million people over the next 25 years.

However, only about 24% of new labour market entrants currently secure wage-paying jobs.

The report stresses the need for structural transformation—especially in manufacturing, digital services, and agribusiness—to absorb the growing workforce and capitalize on this demographic momentum.

Regional and Sectoral Patterns

Growth remains uneven across subregions:

• East Africa leads with projected growth above 5%, supported by strong performance in services, tourism, and construction.

• West Africa is expected to expand around 4.1%, anchored by Nigeria’s recovery and improved agricultural output.

• Southern Africa lags, averaging 2.4%, weighed down by weak industrial output and electricity shortages.

Diversified economies such as Côte d’Ivoire, Kenya, and Senegal continue to outperform commodity-dependent nations.

Sectors driving regional resilience include telecommunications, renewable energy, and transport infrastructure.

The World Bank notes that sustaining growth above 4% will require targeted reforms to enhance productivity, strengthen fiscal governance, and expand access to finance.

Investments in infrastructure, digital connectivity, and human capital are critical to harnessing the potential of Africa’s demographic transition and ensuring economic transformation translates into broad-based prosperity.