Africa’s GDP to hit 4% in 2026, $1.43trn extra revenue  achievable – Report

Bamidele Famoofo

With the right policies, Africa has the potential to mobilize an additional $1.43 trillion in domestic resources from both tax and non-tax revenue sources, and curbing leakages.

The African Economic Outlook report from the African Development Bank ( AfDB) which made the disclosure also hinted that the Continent’s economy will record a 4 per cent growth by 2026.

“Africa’s economy is projected to increase from 3.3 percent growth in 2024 to 3.9 percent in 2025, reaching 4 percent in 2026, despite mounting geopolitical uncertainties and trade tensions,” the African Development Bank Group said Tuesday in its flagship 2025 African Economic Outlook report.

Despite the prevailing domestic and external challenges  Africa continues to demonstrate notable resilience. The report, titled “Making Africa’s Capital Work Better for Africa’s Development,” was released during the Bank Group’s 2025 Annual Meetings, taking place in Abidjan, Côte d’Ivoire. It demonstrates the continent’s capacity to weather multiple shocks while identifying pathways to unlock a vast potential for transformation.

Strong growth outlook despite global headwinds 

The report presents encouraging projections despite significant challenges:

21 African countries will achieve growth exceeding 5 percent in 2025, with four countries—Ethiopia, Niger, Rwanda, and Senegal—potentially reaching the critical 7 percent threshold required for poverty reduction and inclusive growth.

Africa’s projected growth rates will surpass the global average and outpace most other regions except emerging and developing Asia.

Africa’scontinued resilience is built on effective domestic reforms and improved macroeconomic management.

Mixed growth performance across Africa’s regions 

Growth prospects vary significantly across regions: East Africaleads with a projected 5.9 percent growth in 2025-2026, driven by resilience in Ethiopia, Rwanda, and Tanzania. West Africa maintains solid 4.3 percent growth, driven by new oil and gas production coming onstream in Senegal and Niger. In the face of persistent headwinds, North Africa is expected to register 3.6 percent growth in 2025. In Central Africa, growth is projected to slow to 3.2 per cent and Southern Africa will grow at only 2.2 percent, with its largest economy, South Africa, expected to achieve only 0.8 percent growth

Significant challenges persist. Fifteen countries are experiencing double-digit inflation, while interest payments now consume 27.5 percent of government revenue across Africa, up from 19 percent in 2019.

“Africa must now face the challenge and look inwards to mobilizing the resources needed to finance its own development in the years ahead,” said Prof. Kevin Chika Urama, Chief Economist and Vice President of the African Development Bank Group, presenting the report’s findings.

Massive domestic resource potential remains untapped  

The AEO 2025 estimates that, with the right policies, Africa could mobilize an additional $1.43 trillion in domestic resources from tax and non-tax revenue sources through efficiency gains alone. Africa’s extraordinary but underutilized resource base includes:

Natural capital: Africa hosts 30 percent of global mineral reserves and could capture over 10 percent of the projected $16 trillion in revenues from key green minerals by 2030

Human capital: The continent’s median age of 19 represents a demographic dividend that could add $47 billion to Africa’s GDP through improved workforce participation

Financial capital: Pension fund assets have grown to $1.1 trillion, while formal remittances could reach $500 billion by 2035 if transfer costs are reduced

Business capital: Full implementation of the African Continental Free Trade Area could increase exports by $560 billion and boost continental income by $450 billion by 2035

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