According to the United Nations ‘World Economic Situation and Prospects 2024’, certain African nations face challenges in 2024, marked by the lowest economic projections and potentially lower numbers in the subsequent year.
Such low economic projections pose significant challenges to businesses operating there in the countries. Heightened financial caution in the atmosphere often leads to reduced consumer spending, while investor confidence wanes, fostering doubts in economic contributions.
At the same time, economic downturns prompt financial institutions to tighten lending standards, amplifying difficulties for businesses, particularly small and medium enterprises, in securing the necessary capital for operations and expansion.
Here are the 10 African countries with the lowest economic growth forecasts for 2024.
Sudan tops the list with a grim projection of -10.5% real GDP growth for 2024. The country has been struggling with political instability, economic sanctions, and internal conflicts, which have significantly hampered its economic development. The recent political transitions and ongoing challenges pose formidable hurdles to Sudan’s efforts to revive its economy.
Equatorial Guinea faces a projected real GDP growth of -2.8% in 2024. Despite being a major oil producer, the country’s economy is heavily reliant on hydrocarbon exports. The volatility of oil prices, coupled with issues of mismanagement and corruption, has contributed to its economic downturn.
South Africa, the continent’s most industrialized nation, anticipates a modest growth of 1.4% in 2024. The country is tussling with structural issues such as high unemployment, inequality, and an unreliable energy supply. Additionally, the impact of the global economic slowdown affects its export-dependent industries.
Lesotho, a landlocked nation surrounded by South Africa, forecasts a real GDP growth of 1.6%. Despite its efforts to diversify its economy, Lesotho remains susceptible to external shocks, especially those emanating from its larger neighbor, South Africa.
Tunisia’s economy is expected to grow by a modest 1.8% in 2024. The country faces challenges related to political instability, high unemployment rates, and a slow pace of economic reforms. These factors hinder Tunisia’s ability to attract foreign investments and stimulate sustained economic growth.
Malawi, while projected to grow at 2.0%, faces challenges related to agriculture dependence, food insecurity, and vulnerability to climate change. Efforts to diversify its economy and address these issues are crucial for sustaining growth in the long term.
Gabon’s economy is expected to grow by 2.3%, reflecting its reliance on oil exports. Similar to Equatorial Guinea, Gabon faces challenges related to the volatility of oil prices and the need for economic diversification to reduce dependency on hydrocarbons.
Despite the recent peace agreement, South Sudan projects a modest growth of 2.5% in 2024. The nation faces challenges such as political instability, low infrastructure development, and the aftermath of prolonged conflicts, hampering its economic recovery.
Namibia’s economy is expected to grow by 2.6% in 2024. The country faces challenges related to a high unemployment rate, income inequality, and overdependence on mining exports. Addressing these issues is crucial for sustained and inclusive economic growth.
Algeria completes the list with a projected real GDP growth of 2.7%. The country’s economy is heavily reliant on hydrocarbon exports, and its growth is closely tied to global oil prices. Economic diversification efforts and structural reforms are essential for sustained growth.