Africa’s growth slows in 2026, but AfDB expects rebound next year

In its latest annual outlook, the AfDB forecast that the continent’s economy will expand by 4.2% in 2026, down from 4.4% in 2025.

Despite the slowdown, the bank said Africa’s growth remains resilient and continues to outpace regions such as Europe and Latin America. Growth is projected to recover to 4.4% in 2027.

East Africa slows but remains fastest-growing region

East Africa, the continent’s fastest-growing region, is expected to see growth ease to 5.9% this year, compared with 6.6% in 2025.

The AfDB expects the region to rebound to 6.4% in 2027, assuming global supply and energy disruptions begin to ease.

Central Africa is among the few regions forecast to improve, with growth expected to rise to 3.8%, up from 3.6% last year.

Southern Africa remains one of the continent’s weakest-performing regions. Growth is projected at 2.1%, down from 2.3% in 2025, weighed down by high energy costs and weaker mining and agricultural output.

Inflation and debt risks remain

The AfDB warned that risks to the outlook remain significant.

Inflation is expected to average 10.4% this year, while disruptions linked to the blockade of the Strait of Hormuz could put further pressure on fiscal and external balances.

The bank also warned that market volatility and exchange rate depreciation could increase debt burdens across the continent.

External financing under pressure

Global political divisions and shrinking development aid flows could add further pressure on African economies.

The AfDB said reduced access to external financing, including official development assistance, may make it harder for countries to fund infrastructure, energy, climate adaptation and social development needs.

Even so, the bank said Africa’s medium-term outlook remains positive, provided countries can manage inflation, strengthen fiscal buffers and attract more investment.