The Africa Export-Import Bank (AfreximBank) warns that African economies could face a harsher financial environment even as global headline inflation is projected to ease toward 3.8 per cent by the end of 2026. The bank, in its latest Monthly Developments in the African Macroeconomic Environment report, highlights how stabilising global prices combined with structurally higher borrowing costs may strain Africa’s fiscal and investment outlook.
According to the report, headline inflation declines are expected to be driven largely by easing commodity price pressures, following months of global volatility linked to geopolitical tensions and energy market disruptions. However, services inflation remains sticky in many advanced economies, reflecting ongoing wage pressures and costlier service delivery.Â
AfreximBank points to a structural shift in the global economy. Global output grew an estimated 3.3 per cent in 2025 and is expected to maintain similar growth through 2026 and 2027. While this indicates resilience after successive shocks, the growth rate is down from pre-2008 averages of nearly four per cent, reflecting a structural slowdown. Combined with high public debt, tighter global liquidity, and risk repricing, this signals that interest rates are likely to remain higher for longer, complicating borrowing for African governments and corporates.
The report also identifies rapid technological investment, particularly in artificial intelligence, semiconductors, cloud infrastructure, and digital technologies—as a key driver of future productivity. Yet, these investments are heavily concentrated in advanced economies and select emerging markets, raising concerns over widening technological and productivity gaps. For Africa, this underscores the risk of being left behind in a rapidly evolving global value chain.
Despite these headwinds, AfreximBank notes that African economies have displayed resilience, with domestic demand, regional trade, and commodity export revenues supporting stability. Yet, slower global growth, elevated borrowing costs, and increasing geopolitical fragmentation create urgency for policy action. The bank recommends deepening intra-African trade, strengthening regional value chains, and mobilising innovative development finance to mitigate external shocks and sustain growth.
