Africa’s 2025 economic outlook signals strength (Graphic: Hope Mukami, bird story agency)
The latest report on Africa’s economy from the African Development Bank (AfDB) highlights how bold reforms, rapid investments, and pro-business policies are driving a shift toward a more self-reliant and shock-resistant economic future.
The report, “Africa’s Performance and Outlook,” by the African Development Bank (Afdb), confirms that Africa is now the second-fastest-growing regional economy after Asia, with growth projected to rise from 3.2% in 2024 to 4.1% in 2025 and 4.4% in 2026.
“Africa’s average real GDP growth is projected to increase by 0.9 percentage points to 4.1 percent in 2025. The growth outlook for this year is underpinned by expectations of moderating inflation as aggressive monetary policy gains traction and food prices begin to subside,” the authors outline in the February report.
According to experts, a wave of new governments is spearheading bold reforms, driving massive investments in infrastructure, manufacturing, and technology.
“Last year, we saw massive regime transitions on the continent, with close to 20 countries holding presidential general elections. With regime change comes new governments that are actively vouching to implement fresh policies,” Redding Maseko, a South African economist and a member of the African Union Youth Alliance, told bird story agency.
The private sector is at the forefront of powering the continent’s growth, with startups, renewable energy, and AfCFTA trade unlocking new opportunities.
According to Albert Muchanga, African Union Trade Commissioner, the private sector has the potential to further propel strategic initiatives by investing in initiatives like the African Continental Free Trade Area.
“I expect African businesses to establish logistics centres and warehouses across the continent. I also expect them to start planning for an African shipping line…. We are sitting on immense potential, which we are yet to fully respond to,” Muchanga said.
Regionally, the authors expect the East African region to surge ahead, fuelled by growing private investments and infrastructure developments. Rwanda, Uganda, Tanzania, and Kenya are building, expanding, and attracting capital.
Half of East Africa’s economies—South Sudan, Rwanda, Uganda, Ethiopia, Tanzania, and Kenya—are set to grow by at least 5% in 2025, driven by strong investments, expanding infrastructure, and a booming private sector.
Agriculture, energy and tourism are especially reshaping the region’s economy. Kenya’s agritech boom is fueling growth, transforming farming with innovation. In Tanzania, a thriving service sector, led by a surging tourism industry, is creating jobs and attracting investment.
Interestingly, South Sudan is roaring back, with its oil sector rebounding. The country’s economy is expected to grow by 17% in 2025 after shrinking by 24.5% last year, thanks to the recovery of oil production and exports.
The West African region will trail the East with its major economies such as Nigeria and Senegal thriving in the region thanks to oil price stabilization and success with oil refineries.
A year after the Dangote oil refinery was launched, the facility is making significant refining progress, with the latest revelations showing it is on track to achieve 650,000 barrels per day full production capacity next month.
According to Aliko Dangote, the US$20 billion refinery currently “produces enough refined products, like gasoline, diesel, and kerosene, to meet 100 percent of Nigeria’s requirements.”
“We can satisfy more than the local needs of Nigeria. As we speak, we have more than half a billion litres (of petrol). We have more than N600bn worth of stocks here today in the refinery. We have more than enough,” he is quoted in the Punch newspaper during a visit to the facility this week with Zambia’s Minister for Energy.
Senegal this week also marked a milestone in self-sufficency when Société Africaine de Raffinage (SAR) processed its first locally-extracted crude at a newly-launched 90,000-ton refinery.
According to a February 2025 press statement, SAR processed 650,000 barrels of crude oil, yielding 90,000 tons of petroleum products, the company announced.
A refinery boom appears to be reshaping West Africa’s energy landscape, boosting local capacity and reducing reliance on imports.
Nigeria’s Port Harcourt refinery recently completed a US$1.5 billion overhaul to boost its capacity while Ghana has embarked on a US$12 billion petroleum hub project in Jomoro, featuring a 300,000 barrel-per-day refinery and petrochemical plants, aiming to position itself as a regional leader in the oil sector.
The expansion of refining capacity in West Africa is expected to significantly impact the region’s economy.
In 2023, Europe exported an average of 1.33 million barrels per day (bpd) of gasoline, with approximately one-third destined for West Africa (predominantly, Nigeria) according to research and data firm Kpler.
Beyond the West, North Africa’s economy is also on the rise, with Egypt driving reforms and Morocco recovering from drought. Real GDP is set to climb from 2.7% in 2024 to 3.9% in 2025 and 4.2% in 2026, fueled by infrastructure, tourism, and foreign investment.
Libya will also contribute significantly to the region’s economy. After a -3.2% contraction in 2024, and following a lengthy civil war, Libya’s economy is set to surge, with 7.5% growth expected in 2025, driven by revived oil production and a breakthrough deal on central bank and oil revenue control.
The demand for critical minerals continues to be the greatest driver of economic growth in Central Africa. Growth in the region is, however, projected to hold steady at 4.0% in 2025 and improve marginally to 4.1% in 2026.
The Democratic Republic of Congo (DRC) will stay the region’s growth leader, driven by a sustained rebound in private consumption. Growth in the DRC will undergo a moderation from 5.5% in 2024 to 5.3% in 2025 and 5.0% in 2026.
However, recent events could alter projections. The DRC’s deepening humanitarian crisis is crippling livelihoods and disrupting key economic hubs like Goma, amplifying financial strain.
The Southern African region is also set for a strong rebound, with real GDP expected to almost double from 1.8% in 2024 to 3.0% in 2025 and 3.1% in 2026, driven by robust performances in Eswatini, Zambia, and Zimbabwe, where growth is expected to be at least 5%.
“This pickup marks the first time since 2021 that the region’s growth has exceeded 2 percent,” the authors explain.
While Southern Africa’s largest economy, South Africa, will remain sluggish — rising from 0.9% growth in 2024 to 1.7% in 2025 — most other countries, except Namibia and Lesotho, are set to grow between 3% and 4%.
Despite the positive trajectory, the report highlights that Africa’s growth remains below the 7% threshold required for substantial poverty reduction. The continent also continues to grapple with geopolitical tensions, structural weaknesses, climate-related disasters, and prolonged conflicts.
Most strikingly, Africa’s growth is outpacing the global average, with 12 African economies projected to be among the world’s top 20 fastest-growing in 2025.
According to Maseko, “this signals a maturing continent — one that, despite inflationary pressures, debt challenges, and geopolitical risks, is increasingly setting its own economic agenda for the future.”
“If this momentum is sustained, Africa will not only withstand global shocks but also emerge as a key player in shaping the world’s economic future.”
— bird story agency
