Central Africa tops African regions in 2022 GDP growth: AfDB

08 Aug '23

2 min read

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Insights

Central Africa outperformed in 2022 with a 5 per cent GDP growth, surpassing the African average, per the AfDB's report.
The region had the continent's best inflation rate and strongest budget performance.
Driven by raw material prices, Central Africa also focuses on sustainable development, seeking $128 billion from 2020-2030 for green initiatives.

Central Africa showcased a gross domestic product (GDP) growth of 5 per cent in 2022, surpassing the previous year's 3.4 per cent, according to the Central African Economic Outlook 2023 report released by the African Development Bank (AfDB). This growth, spurred by favourable raw material prices, exceeded the African average of 3.8 per cent for 2022, a dip from 4.8 per cent in 2021.

Central Africa's 2022 economic performance also stood out with an inflation rate of 6.7 per cent, the best across the continent. In contrast, North, Southern, West, and East Africa reported inflation rates of 8.2 per cent, 12.6 per cent, 17 per cent, and 28.9 per cent, respectively.

Financially, the region demonstrated the strongest budget performance. The 2022 budget balance improved to a deficit of just 0.6 per cent of GDP, bettering the previous year by 0.4 percentage points. The lingering effects of the Russian invasion of Ukraine on energy and food prices, despite enhanced export rates, primarily explain this deficit, as per AfDB’s report.

Notably, the Democratic Republic of Congo played a significant role at the intraregional level, registering an impressive 8.5 per cent growth.

Addressing policy recommendations, the report emphasised the urgency of curbing inflation and fostering economic resilience. Central Africa's potential lies in its agro-industrial sector, which holds a distinct comparative advantage, necessitating its development.

Central Africa requires approximately $128 billion from 2020 to 2030, averaging $11.6 billion annually, to fund green growth and sustainable development. The region's substantial natural assets, notably the Congo Basin - the world's second-largest ecological haven after the Amazon, valued over $700 billion, could bolster these climate efforts.

Many countries have already initiated the Support Programme for the Development of the Green Economy in Central Africa, integrating mitigation and adaptation measures from their nationally determined contributions.

To drive future success, Central African nations need to pioneer innovative funding avenues to lure private-sector investment. The report recommends redirecting private-sector climate finance towards low-risk, high-yield sectors, and broadening capital access for small and medium-sized enterprises (SMEs), especially those helmed by women and the youth.

Fibre2Fashion News Desk (DP)

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