Africa’s Economic Growth will hit 3.8% in 2025–ECA Report

Economic Commission for Africa’s (ECA) Economic Report on Africa (ERA), says the continent’s economic growth will recover gradually, reaching 3.8 per cent in 2025 and 4.1 per cent in 2026. According to the report, the growth is driven by increased private consumption and improved trade performance. The report warned that in spite the rebound, growth remained below the level required to enhance living standards and achieve the Sustainable Development Goals (SDGs). The ECA reiterated multiple downside risks threatening the continent’s growth prospects, including global economic tensions, an escalated U.S.-China trade war, regional and domestic conflicts, and the increasing frequency of climate shocks. “While Africa’s debt-to-Gross Domestic Product (GDP) ratio is projected to decline from 67.3 per cent in 2023 to 62.1 per cent in 2025, concerns persist over high debt levels. “Also, expensive borrowing costs continue to limit essential development spending, prompting calls for reforms in the global financial system,” it said.
On poverty, the report said the proportion of Africans living in extreme poverty (below 2.15 dollar per day) was declining. It said the absolute number of people in poverty had risen to an estimated 468 million, worsened by recent economic crises. The report also emphasised the urgent need for climate action, citing that in 2022, weather, climate, and water-related hazards affected more than110 million Africans, causing economic losses exceeding 8.5 billion dollars. With 76 million young Africans not in employment, education, or training, the ECA called for greater investment in skills development to harness the continent’s youthful workforce and strengthen economic resilience. Amid concerns over global trade wars, the report said there was opportunity for Africa to enhance intra-regional trade and self-reliance through the African Continental Free Trade Area (AfCFTA).