The International Monetary Fund (IMF) has urged sub-Saharan African countries to accelerate investments in electricity, broadband infrastructure, digital skills and AI governance, warning that the region risks missing out on the transformative benefits of artificial intelligence if it fails to act quickly.
In a new analysis titled “Africa Can Grow Faster With AI—If It Moves Now,” IMF economists Martin Schindler, Nikola Spatafora and Andrew Tiffin said artificial intelligence has the potential to boost productivity, improve public service delivery and create better-quality jobs across the region. However, they cautioned that these benefits will only be realised if governments establish the right enabling environment for widespread AI adoption.
According to the IMF, under current levels of AI readiness, artificial intelligence is expected to contribute only about 0.2 per cent to sub-Saharan Africa’s gross domestic product over the next decade. But with stronger investments in digital infrastructure and broader adoption of AI technologies, the contribution could increase to about 4 per cent over the same period, translating to nearly half a percentage point of additional economic growth annually.
The report noted that the projected growth is particularly important as sub-Saharan Africa prepares for a rapidly expanding workforce. By 2030, the region is expected to account for approximately half of all new entrants into the global labour force.
Rather than replacing workers, the IMF said AI’s greatest value in Africa lies in improving productivity across sectors dominated by informal businesses and smallholder farmers.
It explained that AI-powered tools could help informal enterprises manage inventory more efficiently, enable farmers to improve crop yields through better decision-making, and support medium-sized businesses in transitioning into formal enterprises capable of exporting their products.
The IMF, however, warned that Africa currently trails every other region in AI adoption, raising concerns that the productivity gap between African economies and more advanced economies could widen if adoption remains slow.
The report highlighted agriculture as one of the sectors with the greatest opportunity for AI-driven transformation. It noted that AI applications can provide farmers with practical guidance on planting schedules, fertiliser application, pest management and climate adaptation using accessible digital platforms.
It pointed to Kenya’s Agricultural Observatory Platform as an example of how real-time weather and crop management data can support farmers’ decisions, while pilot projects in Ghana, Nigeria, Rwanda and Uganda have shown that digital advisory services can significantly improve agricultural yields when combined with better farming inputs.
South Africa has also recorded positive outcomes through AI-enabled crop monitoring systems that have increased productivity while reducing waste, the IMF added.
Beyond agriculture, the institution identified education, healthcare and public finance as sectors where AI could deliver significant development gains.
In education, AI-powered tutoring platforms and SMS-based learning tools could help address teacher shortages and improve learning outcomes. The report cited pilot programmes in Nigeria where chatbot-based tutoring produced measurable improvements in students’ academic performance, while Rwanda’s investments in digital skills and school connectivity demonstrate how AI can support broader education reforms.
The IMF also said AI could strengthen healthcare delivery by assisting medical professionals with patient triage, diagnosis and follow-up care, helping overstretched health systems serve more people efficiently.
In public administration, the report noted that governments are already deploying AI-driven data analytics to improve tax administration. It referenced initiatives in countries including Kenya and South Africa, where data analytics are helping tax authorities strengthen compliance and increase domestic revenue mobilisation.
Drawing parallels with Africa’s success in mobile money adoption, the IMF argued that AI could become the continent’s next technological leap if solutions are designed to be affordable, practical and trusted by local communities.
To unlock these opportunities, the institution identified two immediate priorities.
The first is expanding the foundations required for widespread AI adoption by investing in reliable electricity, affordable broadband connectivity, regional data infrastructure and digital literacy programmes.
The IMF stressed that African countries do not necessarily need to build the world’s most advanced AI models but must develop the capacity to adopt, adapt and deploy existing AI technologies at scale.
The second priority, according to the report, is building public trust through effective governance. It warned that AI could widen inequality if its benefits remain concentrated among large businesses, highly skilled workers and urban centres.
The economists called on governments to establish practical regulations covering data protection, cybersecurity, competition, consumer rights and responsible public-sector use of AI. They also advocated stronger regional collaboration, noting that many African economies lack the scale to independently build robust AI ecosystems but could achieve greater impact through shared infrastructure, harmonised regulations and common data standards.
The IMF concluded that artificial intelligence should be viewed not simply as a technology issue but as a central pillar of Africa’s long-term economic growth strategy, adding that the decisions governments make today will determine whether the continent narrows or widens its productivity gap with the rest of the world.
