Economic activity in Sub-Saharan Africa is projected to accelerate gradually, rising from 3.3 percent in 2024 to 3.5 percent in 2025, and reaching 4.2 percent by 2026, according to the latest edition of Africa’s Pulse, a biannual report published this week by the World Bank.
The report, produced by the Office of the Chief Economist for the Africa Region, attributes the region’s improving economic trajectory to robust private consumption and investment, aided by easing inflation and improving financial conditions both domestically and globally.
However, the outlook remains clouded by global uncertainties. “This outlook is subject to heightened risks arising from global policy uncertainty. The direct and indirect impacts of recent and future policy changes will materialise and evolve over time,” the report cautions.
Per capita growth is also set to improve, rising from 0.7 percent in 2024 to 1.1 percent in 2025, and 1.7 percent in 2026.
The region has faced repeated external shocks over the past decade, including the 2014–15 global commodity price collapse, extreme weather events, the COVID-19 pandemic, the Russia-Ukraine war, and the ongoing conflict in the Middle East. Recovery from these shocks has been sluggish.
By 2025, real income per capita is expected to be only 0.6 percent below its 2019 pre-pandemic level. Meanwhile, real GDP per capita is projected to surpass its 2015 peak by 1.2 percent in 2027. However, the pace of recovery varies widely across country groups, shaped by factors such as natural resource dependency and state fragility.
“On average, real income per capita in 2025 among non-resource-abundant, non-fragile countries is projected to be 6 percent above its level a decade ago. By contrast, income per capita in non-resource-abundant but fragile countries is expected to remain 5 percent below its 2015 level,” the report notes.
The situation is even more dire for resource-rich countries. In fragile, resource-abundant nations, income per capita in 2025 is projected to be 12 percent below 2015 levels, while in their non-fragile counterparts, the gap widens to 19 percent.
The report highlights the region’s inability to regain strong growth momentum over the past decade, largely due to a marked slowdown in investment.
Africa’s Pulse previously documented a sharp deceleration in gross fixed capital formation, which fell from 7.2 percent annually in 2010–14 to 5.1 percent in 2015–19, and then contracted by 0.3 percent during 2020–21.
From 2022 to 2024, investment growth has averaged a mere 0.2 percent per year.
Still, there are significant differences between countries. Investment remained relatively resilient among non-resource-abundant countries, regardless of their fragility status.
From 2015 to 2025, gross fixed capital formation in non-resource-abundant, non-fragile countries grew at 6.4 percent annually. In contrast, investment growth in both fragile and non-fragile, resource-rich countries was less than 1 percent per year.
The report links this divergence in economic outcomes to the strength of institutions.
“The better performance of per capita income and investment growth among non-resource-abundant, non-fragile countries is related to stronger governance, particularly in areas such as government effectiveness and the quality of regulation,” the World Bank states.
“These countries tend to outperform in service delivery and policymaking and maintain regulatory frameworks that better support private sector development. Conversely, resource-rich, fragile countries score lowest on governance indicators.”
Looking forward, the report emphasises that achieving and sustaining growth across Sub-Saharan Africa will require equipping people with the skills and tools to thrive and setting up governments to foster efficient and inclusive business ecosystems.
“Governance reforms may support broad-based opportunities through three channels: strengthening the fiscal contract with citizens, bolstering market confidence, and enhancing economic oversight,” the report reads.
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