Washington, D.C. · 17 April 2019 — The World Bank's Spring 2019 edition of Africa's Pulse, the institution's biannual assessment of the continent's economic health, reported that growth in Sub-Saharan Africa decelerated to 2.3% in 2018, down from 2.5% in 2017. This marked the fourth consecutive year in which regional economic growth remained below the rate of population growth, meaning that per capita income was effectively contracting for the average African citizen.
The report, released during the World Bank–IMF Spring Meetings in Washington, projected a modest recovery to 2.8% for 2019. However, the authors cautioned that this recovery was weaker than previously expected and insufficient to meaningfully reduce poverty across the region.
Drivers of the Slowdown
The deceleration was attributed primarily to weaker performance among the region's major oil-exporting economies. Nigeria, Africa's largest economy, saw oil production decline, while Angola experienced continued contraction in its oil sector. A deep economic contraction in Sudan and a broad-based slowdown across non-resource-intensive countries further dampened regional growth.
The report noted that growth performance varied significantly across the region. Non-resource-intensive countries — including Rwanda, Côte d'Ivoire, Ethiopia, and Kenya — continued to grow at rates above 6%, driven by strong domestic demand and investment in infrastructure. However, the weighted average was pulled down by the sluggish performance of the continent's largest economies.
| Country Group | 2018 Growth Rate | Key Drivers |
|---|---|---|
| Sub-Saharan Africa (regional) | 2.3% | Oil sector weakness, Sudan contraction |
| Resource-intensive (oil exporters) | Below 1% | Declining oil production, price volatility |
| Non-resource-intensive | Above 6% | Domestic demand, infrastructure investment |
| Projected 2019 (regional) | 2.8% | Modest recovery in oil production, commodity prices |
The Poverty Paradox
Perhaps the most sobering finding of the report was its analysis of poverty trends. The World Bank noted that while the share of people living in extreme poverty in Sub-Saharan Africa had declined from 56% in 1990 to approximately 43% by 2012, the total number of people in extreme poverty had actually increased due to rapid population growth.
The report highlighted a persistent structural challenge: the region's "growth elasticity of poverty" — the extent to which economic growth translates into poverty reduction — was consistently lower in Sub-Saharan Africa than in other regions. This was attributed to a weak "passthrough" from GDP growth to household consumption, driven by high inequality, the dominance of capital-intensive extractive sectors in many economies, and limited employment creation in the formal sector.
Digital Economy as a Structural Lever
A distinctive feature of the Spring 2019 report was its focus on the digital economy as a potential catalyst for structural transformation. The World Bank estimated that digital transformation could reduce poverty in Sub-Saharan Africa by nearly one percentage point per year — a significant figure given that the region was struggling to make any poverty gains at current growth rates.
The report identified three channels through which digital technologies could drive inclusive growth:
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Expanding financial inclusion: Mobile money platforms, pioneered in Africa with M-Pesa in Kenya, had already demonstrated the potential of digital finance to reach unbanked populations. The report noted that digital financial services could reduce the cost of remittances and enable small businesses to access credit.
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Improving agricultural productivity: Digital advisory services, market information platforms, and precision agriculture technologies could help close the yield gap in African agriculture, where productivity had stagnated for decades.
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Enabling new business models: E-commerce platforms and digital marketplaces could connect producers to wider markets, particularly benefiting small and medium-sized enterprises that had been constrained by limited market access.
Policy Recommendations
The report called for a three-pronged policy approach:
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Restoring macroeconomic stability: Countries with high debt burdens and fiscal deficits needed to implement credible consolidation strategies. The report noted that public debt had risen sharply in many African countries since 2013, with several countries exceeding sustainability thresholds.
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Investing in human capital: The World Bank's Human Capital Index, launched in 2018, had revealed that children born in Sub-Saharan Africa could expect to achieve only 40% of their potential productivity as adults. Investing in health, education, and social protection was essential for long-term growth.
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Building institutional quality: The report emphasised that governance reforms — including improving public financial management, strengthening anti-corruption frameworks, and enhancing the business regulatory environment — were critical for attracting investment and ensuring that growth translated into broad-based welfare improvements.
A Region at a Crossroads
The Africa's Pulse report painted a picture of a continent at a structural crossroads. The rapid growth period of 1999–2014, when the region averaged growth rates above 5%, had clearly ended. The current trajectory — growth below population increase, rising poverty numbers, and persistent structural vulnerabilities — demanded a fundamentally different approach to development policy.
The World Bank's message was clear: business-as-usual would not deliver the structural transformation needed to absorb the 12 million young people entering the labour market each year, nor would it reverse the trend of rising extreme poverty. The digital economy offered one promising pathway, but only if paired with the hard institutional and infrastructural work that underpins sustained, inclusive development.
Sources:
- World Bank, Africa's Pulse, No. 19, Spring 2019 (April 2019)
- World Bank, "Taking the Pulse of Africa's Economy," April 2019
- World Bank, Poverty in a Rising Africa (2016)
- New African Magazine, "Africa's Pulse: The State of African Economies According to New World Bank Report," 2019
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Institutional Research Desk · Foresight Institute of Research and Translation
The collective editorial and research translation board of FIRAT, synthesising peer-reviewed evidence, policy briefs, and division milestones across our seven foundational research pillars.
