West Africa GDP projected to expand by 4.2% in 2024
The latest African Economic Outlook 2023 report published by the prestigious African Development Bank reveals that despite facing macroeconomic challenges in some of its key economies, West Africa is poised for modest growth. Projections indicate that the region’s growth rate will rise from an estimated 3.8 percent in 2022 to 3.9 percent in 2023, with a further increase to 4.2 percent anticipated in 2024. This optimistic outlook primarily stems from the strong growth performance of small economies within the region. Surprisingly, eight out of the nine countries expected to achieve growth rates of 5 percent or higher in 2023 are small economies, collectively contributing to 15 percent of the region’s GDP and 22 percent of projected growth.
Furthermore, Africa as a whole is set to establish itself as the second-fastest growing region globally, trailing only behind Asia, for the years 2023 and 2024. This remarkable resilience in the face of multiple global shocks highlights the continent’s ability to navigate challenging circumstances and sustain economic progress.
However, the projected growth trajectory for Africa is contingent upon favorable global conditions and the continent’s capacity to fortify its economic resilience. The African Development Bank’s African Economic Outlook 2023 report emphasizes the need for robust policy actions to solidify this growth and mitigate potential risks. Key recommendations include incentivizing green industries and providing substantial guarantees to de-risk private sector investments aimed at managing the continent’s vast natural capital.
The report underscores the significance of prioritizing sustainable and environmentally friendly industries to drive economic growth. By promoting the transition to green industries, Africa can harness its natural resources while simultaneously addressing pressing environmental concerns. Encouragingly, several African countries have already made notable strides in this regard, with sustainable initiatives taking root across various sectors.
To facilitate private sector investments in managing natural capital, the report emphasizes the importance of implementing guarantees at scale. Such measures would alleviate concerns around potential risks and encourage increased private sector participation in key sectors. By mitigating investment risks, Africa can attract greater inflows of capital and foster economic growth.
The African Development Bank’s report projects that Africa’s post-Covid-19 pandemic recovery will gather momentum, with GDP growth expected to reach 4.3 percent in 2024, a significant increase from 3.8 percent in 2022. Encouragingly, a total of 22 countries across the continent are anticipated to achieve growth rates exceeding 5 percent, signaling a broader trend of accelerated economic development.
The African Economic Outlook 2023 report by the African Development Bank highlights the resilient growth prospects of West Africa amidst macroeconomic challenges. The report also emphasizes Africa’s promising position as the second-fastest growing region globally, underscoring its ability to weather global shocks and sustain economic progress. To capitalize on this momentum, the report urges proactive policy actions, including the promotion of green industries and the facilitation of private sector investments through comprehensive guarantees. By embracing these recommendations, Africa can fortify its economic resilience and pave the way for sustained and inclusive growth in the years to come.
