Afreximbank Cuts Africa’s Growth Outlook Amid Commodity, Trade Pressures
The African Export-Import Bank (Afreximbank) has revised down its outlook for Africa’s economy, cautioning that persistent trade tensions and volatile commodity markets are likely to weigh on growth despite easing inflationary pressures.
In its August 2025 macroeconomic report, the Bank now projects Africa’s GDP to expand by 3.9% in 2025, down from an earlier forecast of 4.1%. Growth is expected to edge up slightly to 4.0% in 2026, supported by ongoing reforms and economic diversification, though global uncertainty is expected to restrain momentum.
The report warns that falling commodity prices and widening trade deficits pose major risks to fiscal stability and debt sustainability. Africa’s average current account deficit is projected to increase to 2.6% of GDP in 2025–26, compared with 1.8% last year.
Trade flows also showed signs of strain. Total trade volumes slipped in April to $127.3 billion, down from $132.6 billion in March. However, year-on-year growth remained positive at 4.9%. Intra-African trade dipped month-on-month but was still 14.9% higher than a year earlier, underscoring resilience in regional commerce.
Afreximbank noted that the recovery remains uneven across the continent. More than 20 economies, including Ethiopia, Rwanda, Kenya, and Uganda are forecast to expand above 5% this year, driven by reforms and domestic demand. In contrast, Africa’s three largest economies; South Africa, Nigeria, and Egypt face weaker growth prospects due to structural challenges and external shocks.
