World Bank forecasts higher growth in sub-Saharan Africa in 2024
The World Bank has projected economic growth in sub-Saharan Africa to rebound to 3.4 percent in 2024, up from 2.6 percent in 2023.
According to the latest World Bank’s Africa’s Pulse report in the April 2024 edition, the recovery is primarily driven by greater private consumption growth as declining inflation boosts the purchasing power of household incomes.
“Investment growth will be subdued as interest rates are likely to remain high while fiscal consolidation constrains government consumption growth,” says the World Bank’s biannual survey of African economies.
The report notes that increased conflict and violence in the sub-Saharan region will continue to weigh on economic activity.
The World Bank said that although civil strife is confined to small economies so far, military coups and the risk of coup contagion significantly impact international investor sentiment and the perception of risk toward the entire region.
According to the global lender, economic growth reduces poverty in sub-Saharan Africa less than in other regions, as measured by the growth elasticity of poverty.
Andrew Dabalen, chief economist for Africa at the World Bank, said in the report that per capita gross domestic product (GDP) growth of 1 percent is associated with poverty reduction of only 1 percent in the region, compared to 2.5 percent in the rest of the world.
“In a context of constrained government budgets, faster poverty reduction will not be achieved through fiscal policy alone. It needs to be supported by policies that expand the productive capacity of the private sector to create more and better jobs for all segments of society,” Dabalen said
