Africa’s economic growth is expected to remain stronger than the global average through 2027, even as a surge in oil prices and tightening financial conditions expose fresh vulnerabilities across the continent, according to new research from the African Export-Import Bank(Afreximbank).
The continent’s output is projected to expand 4.4% in 2026 and 4.5% in 2027, following an estimated 4.3% growth in 2025, supported by reform momentum and a recovery in domestic demand. That compares with global growth of about 3.3%, underscoring Africa’s relative resilience despite mounting external shocks.
Still, the outlook is increasingly fragile. A sharp escalation in geopolitical tensions in the Middle East has disrupted oil flows and pushed Brent crude prices above $110 a barrel, fueling inflation risks and worsening trade balances for energy-importing economies. The shock has also strengthened the U.S. dollar, triggering widespread currency depreciation across African markets and complicating macroeconomic management.
Most African currencies weakened against the dollar in February and March, reflecting global risk aversion and tighter liquidity conditions. Egypt’s currency fell about 12% in a month, while Zambia, Uganda and South Africa also recorded notable declines.
The depreciation is expected to feed into higher import costs, particularly for food and fuel, sustaining inflation pressures even as headline price growth slows. Continental inflation is projected to ease to 10.4% in 2026 from 13.6% in 2025, though it remains elevated in several economies, with at least 11 countries still facing double-digit rates.
Growth remains uneven across the continent. Eastern Africa is forecast to lead with expansion of 6.6% in 2026, driven by infrastructure investment and services, while Southern Africa is expected to lag at 2.2%, constrained by energy shortages and structural bottlenecks.
Large economies such as Egypt, Nigeria and South Africa are expected to anchor overall performance, while smaller or commodity-dependent countries continue to face greater exposure to external shocks.
The oil price surge presents a mixed picture. Exporters like Nigeria and Angola stand to benefit from improved fiscal revenues, while importers including Kenya and Morocco face worsening current account deficits and inflation risks.
African sovereigns are gradually regaining access to international capital markets after a prolonged drought, raising about $5.4 billion in Eurobonds by the end of February. Issuances were led by Kenya, Côte d’Ivoire and the Republic of Congo, though borrowing costs remain elevated due to persistent risk premiums.
Credit rating outlooks have also begun to improve for some countries, signaling cautious investor optimism. However, access remains limited to higher-rated or reform-oriented economies, leaving more fragile states reliant on concessional financing.
The report highlights three structural pressures shaping Africa’s outlook: exposure to commodity price cycles, exchange rate vulnerability and constrained fiscal space amid rising debt servicing costs.
While reforms and improving macroeconomic management have supported stability, the continent’s recovery remains vulnerable to global shocks. Sustained growth will depend on deeper structural changes, including export diversification, stronger domestic revenue mobilization and enhanced resilience to external volatility.
In the near term, Africa’s economic trajectory remains intact, but increasingly conditional on a global environment that is becoming harder to navigate.
