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AfDB report says Africa’s economic growth fell to 3.2% in 2023

Published

9 months ago

February 16, 2024

The African Development Bank (AfDB) said on Friday that although the continent’s economic growth dropped to 3.2 percent last year from 4.1 percent in 2022, it was still expected to expand this year in all sub-regions except Central Africa.

According to the AfDB, the effects of COVID-19 and Russia’s conflict in Ukraine are being exacerbated by political unrest and China’s economic downturn.

The AfDB’s November prediction of 3.4 percent growth was not met by the final 2023 result. In the wake of catastrophic flooding in Libya and an economic downturn in Equatorial Guinea, an oil producer, it also lowered its forecasts for regional growth in Central and North Africa.

“The shocks buffeting African economies since 2020 have damaged growth, with long-term implications,” the bank said in a report.

According to the AfDB, 15 African nations—including Ethiopia, which is restructuring its foreign debt—saw economic growth of more than 5% last year despite the shocks that the continent has been dealing with. These nations include Ivory Coast, Rwanda, Democratic Republic of the Congo, Mauritius, and Ethiopia.

The bank projected faster growth in 2024 across all regions barring central Africa, with Southern Africa continuing to lag behind at 2.2 percent compared to East Africa’s 5.7 percent.

The bank stated that the “sluggish performance reflects the continued economic stagnation in South Africa,” adding that the largest economy in the region—which is hosting national elections this year—is expected to grow by 1.1 percent in 2024, up from 0.8 percent in the previous year.

“This underwhelming economic situation has aggravated the country’s persistently high unemployment, poverty, and inequality and prevented it from reaping democratic dividends in the 30 years since the end of White minority rule,” AfDB said.

According to the report, Egypt’s growth is expected to be hampered by high inflation and shortages of foreign exchange, with growth expected to drop to 3.7 percent this year from 4 percent in 2023.

Meanwhile, Nigeria, the largest economy in West Africa, is expected to grow by 2.9 percent in 2024, up 0.4 percentage points from the previous year as a result of a sharply devalued currency driving up inflation and aggravating a crisis related to the cost of living.

Related Topics:AFDB Africa Economic Growth Featured

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Food prices drive second straight monthly hike in Nigeria’s inflation

Published

3 hours ago

November 17, 2024

Ifeoluwa Dada

According to official statistics released on Friday, Nigeria’s inflation rate increased for the second consecutive month in October, rising to 33.88% in annual terms from 32.70% in September, mostly as a result of increasing food costs.

In an attempt to boost economic development and strengthen public finances, President Bola Tinubu devalued the naira and reduced subsidies, which caused inflation to spike in the second half of last year.

As the effects of the naira devaluation started to lessen in July of this year, a slew of hikes in the price of petroleum and devastating floods that destroyed crops once again exacerbated pricing pressures, making the greatest cost-of-living crisis in decades worse in Africa’s most populous country.

According to the National Bureau of Statistics, price increases for basics such as rice, maize, bread, potatoes, and cooking oil prompted food inflation to surge from 37.77% in October to 39.16% year over year.

This year, more than 1.5 million hectares of agriculture have been damaged by torrential rain and floods in 29 of Nigeria’s 36 states, leaving millions hungry and displacing large numbers of people.

In an effort to curb inflation, the central bank has raised interest rates five times this year. On November 26, it is expected to make its final rate decision of the year.

VenturesNow

MTN financial report reveals drop in group service revenue

Published

3 hours ago

November 17, 2024

Ifeoluwa Dada

Due to operational difficulties in Sudan and the depreciation of the Nigerian naira, MTN Group, Africa’s largest telecom provider, announced on Thursday an 18.5% decline in service revenue for the third quarter that concluded on September 30.

With 288 million users in 17 African regions, MTN said that its group service revenue dropped from 156.3 billion rand ($6.99 billion) in the same quarter of the previous year to 127.4 billion rand.

Despite stating that “the naira was less volatile on a sequential basis in Q3 than in preceding quarters,” the business reported a 48.7% decline in MTN Nigeria’s income due to the currency’s depreciation.

Due to a stronger Ugandan shilling than the previous year, Uganda’s largest contributor, MTN South Africa (MTN SA), expanded by a meagre 3.3%.

Due to “subscriber registration regulations in Nigeria and a decline in users in Sudan, where the conflict has displaced millions of people,” the business reported that its subscriber base increased by 1.6% to 288 million.

Given the higher demand in Nigeria despite the legal obstacles, MTN plans to increase its capital expenditures, which it expects would total between 28 and 33 billion rand for the entire year.