As African economies rebound, AFD forecasts growth for the continent in 2025. This progress relies on various economic, political, and social factors. However, development remains uneven.
Encouraging yet Contrasted Dynamics
African economies show resilience in the face of global challenges. The continent’s growth reaches 4%, double that of the global economy estimated at 2%. However, per capita growth remains limited to 2%. “Africa’s share is increasing in the global economy,” highlights AFD’s General Director, Rémy Rioux.
This dynamic is based on economic diversification and rising commodity prices. Diversified economies experience stronger growth compared to those reliant on a single product or natural resources, notes the agency’s Chief Economist, Thomas Melonio.
Situations vary significantly across the 55 countries on the continent. Commodities remain a key driver. For instance, Côte d’Ivoire benefits from the cocoa boom, while mineral-rich countries capitalize on the growing demand for strategic resources:
- Senegal, with the start of gas exploitation
- Niger, with expanding oil production
- DR Congo and Zambia, growing through copper
- Ghana and Mali, as major gold exporters
Additionally, financial and technological services are rapidly expanding. Benin and Rwanda succeed in diversifying their economies through these high-value sectors, enhancing economic stability.
Debt Management: A Point of Vigilance
Despite positive perspectives, debt remains a central concern for African economies. With high interest rates, loans from international lenders, notably China, weigh heavily on public finances.
However, some countries manage to restructure their debt. Chad, Ghana, and Ethiopia benefit from the Paris Club mechanisms to ease their financial burden. Nevertheless, excessive debt levels could hinder economic progress.
AFD also notes progress in South Africa. The Rainbow Nation makes significant strides with a marked reduction in power cuts, boosting economic activity and enhancing local businesses’ competitiveness. Moreover, African nations are heavily investing in renewable energy to diversify their supply sources.
Investments Supported by AFD
AFD has financed strategic projects in Africa for several years. In 2024, the agency committed an additional 5 billion EUR in investments, a 10% increase from 2023. These funds, primarily in the form of loans, aim to strengthen the productive capacities of partner countries. A notable example is a 350 million EUR loan granted to Morocco’s Office Chérifien des Phosphates (OCP) in 2024. This investment, the largest ever awarded to a company, enhances fertilizer efficiency, a crucial sector for African agriculture.
Generally, AFD has an annual budget of about 14 billion EUR. The French government contributes 2 billion EUR, while the organization raises 10 billion EUR on the markets through bonds, explains Rémy Rioux. However, the agency fears a significant reduction in the resources planned for the 2025 budget. This decrease could compromise its activities in 150 countries, particularly affecting public development aid.
