Kenya, Côte d’Ivoire, and Rwanda are among the fastest-growing African economies in 2023, according to a new report by the World Bank.
The report forecasts that economic activity in Sub-Saharan Africa will accelerate to 3.7 per cent in 2024 and 4.1 per cent in 2025, a signal that growth in the region has bottomed out this year.
The World Bank report attributes the strong economic performance of Kenya, Côte d’Ivoire, and Rwanda to a number of factors, including sound macroeconomic policies, investments in infrastructure and human capital, and a diversified economic base.
The report also notes that the three countries have been relatively less affected by the global economic slowdown and the war in Ukraine.
Kenya
In Kenya, growth remains resilient this year despite political tensions that were partly due to the higher cost of living. Economic activity in Kenya will increase by 5 per cent in 2023, up from 4.8 per cent in 2022, thanks to an expansion in agriculture and a pick-up in private consumption. Commitment to bringing down inflation to the target range and fiscal consolidation remains critical for achieving macroeconomic stability and fostering private sector–driven growth.
Côte d’Ivoire
In Côte d’Ivoire, the largest economy in the West African Economic and Monetary Union (WAEMU), real GDP grew 5.4 per cent YoY in the first quarter of 2023, up from 5.3 per cent in the previous quarter. More recent activity indicators point to a more upbeat outlook for the second quarter. Industrial output growth sharply accelerated in May, thanks to robust manufacturing activity—particularly food and plastics. Electricity, gas, and water production also sped up in May.
Rwanda
Kigali, Rwanda
Rwanda’s economy had a strong start in 2023, with GDP growing by 9.2% year-on-year in the first quarter. This growth was driven by private consumption and higher net exports, although investment outlays contracted due to fiscal consolidation efforts. Contact-intensive services and manufacturing contributed to accelerated growth, while agriculture was subdued by unfavourable weather conditions.
Outlook for the African economy
The World Bank report is a positive sign for the African economy. Growth in the region is expected to accelerate in the forecasting horizon, supported by a recovery in global output and trade, lower global inflation, and gradual easing of global financial conditions.
World Bank
Additionally, a group of countries stand out as established performers, including Cabo Verde, Ethiopia, Mauritius, and Uganda. Another set of nations, such as Benin, Botswana, the Democratic Republic of Congo, Guinea, Kenya, Liberia, Mauritania, Niger, Senegal, and Togo, are showing improvement in their economic performance.
However, some countries are experiencing slipping growth rates, including Angola, Burkina Faso, Chad, Equatorial Guinea, Ghana, Lesotho, Mali, Malawi, Nigeria, São Tomé and Príncipe, and Zambia.
Lastly, some countries are falling behind in their economic performance, including Burundi, the Central African Republic, the Republic of Congo, the Comoros, Gabon, Sudan, and South Africa.
