Just when Africa’s economy appeared to be recovering from the COVID-19 pandemic, a range of internal and external shocks struck such as adverse weather conditions, and the Russian invasion of Ukraine – all of which worsened already rapidly rising rates of inflation and borrowing costs in 2022.
One may argue that the direct trade and financial linkages of Africa with Russia and Ukraine are small, but there is evidence of how the war has damaged the continent’s economies through higher commodity prices, higher food, fuel, and headline inflation.
Regardless of these challenges, Africa still stands strong as home to some of the world’s fastest-growing economies.
According to International Monetary Fund – IMF’s recent World Economic Outlook, 5 of the world’s fastest-growing economies are Angola, Ethiopia, Nigeria, Kenya and South Africa, Business Insider Africa reported.
This economy could quadruple in size and its growth is expected to be at 3.6% in 2023 and rise to 3.9% in 2024.
1. Angola – Angola is set to reclaim its spot as the third-largest economy in sub-Saharan Africa, thanks to a return to growth linked to higher oil prices. Angola is the continent’s second-largest oil producer after Nigeria and is also a significant producer of rough diamonds. The IMF expects Angola’s GDP to expand by 8.6% this year, reaching $135 billion. This is a significant increase from previous years, and Angola’s economy will likely continue to grow in the coming years.
2. Ethiopia – Ethiopia is set to replace Kenya as the fourth-largest economy in sub-Saharan Africa, according to the IMF. This is due to the easing of armed conflict in the nation and the continuation of ambitious economic reform efforts aimed at opening up one of Africa’s fastest-growing but most closed economies. The IMF predicts Ethiopia’s GDPwill reach $126.2 billion this year, expanding by 13.5%. This is an impressive figure, and Ethiopia’s economy will likely continue to grow in the coming years.
3. Nigeria – As the largest economy on the continent, Nigeria maintains its top spot in sub-Saharan Africa’s economic rankings. The IMF predicts that Nigeria’s GDP will hit $574 billion this year. This is an impressive figure, and Nigeria’s economy will likely continue to grow in the coming years.
4. South Africa – The IMF predicts that South Africa will retain its position as the second-largest economy in sub-Saharan Africa, with a GDP of $422 billion this year. This is an impressive figure, and South Africa’s economy will likely continue to grow in the coming years.
5. Kenya – According to the IMF, Kenya’s GDP is projected to record a slower growth of 2.4% this year due to the aftershocks of the Covid-19 pandemic, drought, election jitters, and disruption of global supply chains. The IMF predicts that Kenya’s GDP will reach $117.6 billion this year, behind Angola and Ethiopia. Despite this slower growth, Kenya’s economy is still one of the top economies to watch in the region.