African economy to grow by 3.5% as ACfTA show resilience – Yemi Kale

The African economy is projected to continue its recovery, with an expected growth rate of 3.5 percent and 4 percent in 2024 and 2025, respectively, as African Continental Free Trade Area (AfCFTA) is seen to boost growth.

“The forecast steady growth trajectory signals economic recovery and stability,” said Yemi Kale, Group Chief Economist and managing Director, research and international cooperation, Afreximbank, while presenting the 2024 African trade report and 2024 African Trade and Economic Outlook Report at the ongoing Afreximbank annual meetings, incorporating Africaribbean trade and investment forum, in Nassau, The Bahamas.

According to him, Intra-Africa trade is expected to grow continuously by an average of 0.8 percent in the short to medium term. While Africa’s trade contracted at 6.3 percent in 2023, intra-African trade showed more resilience expanding at 3.2 percent in the same period –underscoring the potential of the AfCFTA to drive economic integration.

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Kale, who was the former Statistician General of the National Bureau of Statistics of Nigeria (NBS) said the African trade and economic outlook 2024 is expected to provide the basis to shape the future of Africa’s economy. It provides valuable insights and actionable recommendations that can contribute to African economies’ capacity to navigate the complexities of the global economic landscape.

As Africa continues on its path towards economic recovery and growth, the insights from this report will be handy in guiding policymakers, business leaders, and other stakeholders in making informed decisions with the view to driving sustainable development across the continent.

The report provides in-depth analysis of the current global and African macroeconomic environment, trade patterns, and sovereign debt sustainability dynamics, as the basis for trade and economic projections for 2025.

Through the examination of historical trends, existing and emerging risks, as well as opportunities, the report seeks to foster a deeper understanding of the factors driving Africa’s economic performance and trade patterns, with a view to informing policy design. It also singles out the implementation of the African Continental Free Trade Area (AfCFTA) and other initiatives as critical to accelerating industrialisation and promoting sustainable growth across the continent.

Speaking earlier, Nomusa Dube-Ncube, Premier of Kwazulu-Natal, said Africa, comprising 17 percent of the world’s population, commands just 4 percent of global GDP and a mere 2 percent of world manufacturing output.

“Our share of world trade stands at a modest 3 percent, a figure dwarfed by the intra-regional trade volumes of other continents. However, within these statistics lies a glimmer of hope. Intra-African exports have seen a notable uptick, accounting for 16.3 percent of our total trade in recent years. While this pales in comparison to other regions, it underscores the potential that lies within our borders. It’s heartening to note that over three-quarters of this trade occurs within regional blocs, signaling a growing intra-African economic ecosystem,” she said.

Pamela Coke-Hamilton, executive director of the International Trade Centre (ITC), emphasised the need for the two regions to explore the possibility of establishing a free trade agreement.

She noted that Trade between Africa and the Caribbean has potential to expand the continent’s economy. ITC projects that trade in goods and services between the two regions will reach $1 billion in value by 2028.