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Rabat – A recent report by the African Development Bank (AFDB) has forecasted that economic growth in North Africa is set to stabilize at 4.3% in 2023, with Morocco and Libya showing their recovery from last year’s economic challenges.
The bank indicated that growth in the region dropped from 5.4% in 2021 to 4.3% in 2022, due to a “sharp contraction” in Libya and the effects of severe drought in Morocco.
Published on Thursday, the biannual report attributes the projected stabilization to “an expected strong rebound in the two countries [Libya and Morocco] and sustained growth elsewhere in the region.”
On the continental level, the report indicated that Africa is set to “outperform” the rest of the world in economic growth in 2023 and 2024, with the gross domestic product (GDP) expected to average 4% in the next two years.
The African continent is projected to exceed expectations and record higher economic growth than the forecasted global averages of 2.7% and 3.2% in 2023 and 2024 respectively, the report noted.
Read also: World Bank Projects Morocco’s Economic Growth to Average 3.5% in 2023
Titled “Africa’s Macroeconomic Performance and Outlook,” the report emphasized that all the continent’s five regions “remain resilient with a steady outlook for the medium-term, despite facing significant headwinds due to global socio-economic shocks.”
The continent was hit hard by the COVID-19 pandemic and the war in Ukraine, slowing GDP growth to 3.8% in 2022, down from 4.8% in 2021. But the majority of African nations (53 out of 54 countries) stood in the face of these challenges and recorded positive growth, the report explained.
However, the report warns about the potential effects of the current global and regional risks on the continent, “including soaring food and energy prices, tightening global financial conditions, and the associated increase in domestic debt service costs.”
In addition, the AFDB warned of the impact of climate change, saying that it poses “equally challenging threats.”
In this respect, the report called for implementing “bold” policies including monetary, fiscal, and structural at all levels to support African countries mitigate these looming challenges.
