World Bank demotes Africa development anticipation
Date
10/17/2024 3:18:17 AM
(MENAFN) The World bank has revised its economic growth outlook for Sub-Saharan Africa (SSA), now projecting a growth rate of just 3 percent for the year, down from the previously estimated 3.4 percent made in April. This adjustment is significantly influenced by the dire economic collapse in Sudan, a consequence of the ongoing civil conflict that has severely impacted the nation's economy.
In its latest regional economic outlook report, "Africa Pulse," the World Bank highlighted that the armed conflict in Sudan has led to the destruction of both physical and human capital, crippling state capacity and exacerbating food insecurity. The humanitarian crisis has resulted in over 11 million people being displaced, with thousands reported dead since the conflict escalated in April 2023.
The World Bank's projections for Sudan are particularly grim, forecasting a staggering 15.1 percent economic decline in 2024, with only a slight recovery of 1.3 percent expected the following year. Andrew Dabalen, the World Bank’s chief economist for Africa, noted that the instability in Sudan has drastically lowered the regional growth expectations. He stated that, without the impact of the Sudanese conflict, the growth rate for the region could have been 3.5 percent higher, closely aligning with the original forecast.
Despite the setback caused by the crisis in Sudan, the World Bank remains cautiously optimistic about the broader economic outlook for Sub-Saharan Africa. The institution anticipates that economic growth will rebound to 4 percent in 2025 and 2026, driven by an expected increase in private consumption and investment. This growth is anticipated as inflation rates in the region are projected to decrease from 7.1 percent in 2023 to 4.8 percent this year, allowing for lower interest rates that could stimulate economic activity.
The World Bank’s report underscores the profound challenges facing Sub-Saharan Africa while also indicating potential paths for recovery, contingent on improved stability and economic conditions across the region.
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