The World Bank announced on Tuesday, October 7, 2025, that it has raised its 2025 economic growth forecast for Sub-Saharan Africa to 3.8%, up from 3.5% projected in April. The upward revision comes despite continued global uncertainty, trade tensions, and high borrowing costs.

In its latest Africa’s Pulse, the World Bank said regional growth is expected to gain further momentum, averaging 4.4% over the 2026-2027 period, slightly higher than the 4.3% projected in April.

Growth prospects for 2025 have been revised upward in 30 of the region’s 47 economies, including key countries showing significant improvements: Ethiopia (up 0.7 percentage points), Nigeria (up 0.6 points), and Côte d’Ivoire (up 0.5 points). Conversely, forecasts were lowered for Angola, Botswana, Mozambique, Senegal, and Zambia.

The region’s stronger growth this year is largely supported by better terms of trade in several countries, which have helped stabilize or strengthen local currencies. As inflation eases across much of the continent, central banks have begun to gradually relax monetary policy, boosting household purchasing power and setting the stage for further rate cuts. These factors are fostering a rebound in private consumption and investment, although ongoing fiscal consolidation in some countries may continue to limit activity and slow the pace of recovery.

Inflation Eases, but Debt Risks Rise

After peaking at 9.3% in 2022, the median inflation rate in Sub-Saharan Africa fell to 4.5% in 2024 and is projected to stabilize between 3.9% and 4.0% a year during 2026–2027. The number of countries with single-digit inflation has risen from 27 in 2022 to an expected 37 over the next two years. Overall, nearly 60% of countries in the region saw inflation decline this year compared with 2024. However, nine countries, Angola, Ethiopia, Ghana, Malawi, Nigeria, São Tomé and Príncipe, Sudan, Zambia, and Zimbabwe, are still expected to record double-digit inflation.

The fall or stabilization in inflation reflects more favorable commodity prices and reduced exchange rate volatility. The World Bank’s food price index was down 4% year-on-year in August 2025, while Brent crude oil prices fell 16% over the same period. At the same time, many regional currencies have appreciated or remained stable against major currencies, helped by easier financial conditions.

For example, the Ghanaian cedi gained 20% against the U.S. dollar during the first eight months of 2025, while the Zambian kwacha appreciated 16% since the start of the year. These shifts have translated into lower domestic fuel and food prices in most countries.

The report also highlighted that Sub-Saharan Africa is relatively insulated from the impact of higher U.S. tariffs, given its limited trade exposure to the U.S. and its growing trade links with other markets.

Growth Still Too Weak to Reduce Poverty

Despite the improved outlook, the region’s economy remains vulnerable to several risks, including uncertainty surrounding U.S. President Donald Trump’s trade policies, sluggish global investor sentiment, tight external financing conditions, and high debt burdens in many countries.

The number of nations in or at high risk of debt distress has nearly tripled, rising from 8 in 2014 to 23 in 2025. The World Bank attributes this increase to heavy borrowing during past crises, persistently low public revenues, and a greater reliance on non-concessional loans outside traditional multilateral channels.

The Bank also emphasized that overall GDP growth remains too weak to drive a significant reduction in extreme poverty or income inequality. Real income per capita is expected to grow 1.3% in 2025, up from 1.0% in 2024, and reach 1.9% during 2026–2027. While this marks a slow but steady recovery after a decade of successive shocks, it is still insufficient to lift large numbers of people out of poverty.

The poverty rate, measured at $3 per day per capita (in 2021 purchasing power parity, or PPP), is expected to decline from 50% in 2024 to 48.4% in 2027. However, due to rapid population growth, the number of people living in poverty is expected to continue rising, from 576 million in 2022 to 671 million in 2027.

Walid Kéfi