A Breakdown of GDP in Africa
While Africa’s GDP growth slowed from 4.2% in 2022 to 3.1% in 2023 due to global and regional shocks, it did see a rebound in 2024 to hit 3.8% growth.
This topline number, however, does not paint a detailed picture. While in comparison to global GDP growth, the 3,8% growth achieved is quite good. However, when looking at the details, it shows a different picture. Most of the top performers grew off a very low GDP value base, while the biggest economies in Africa, South Africa and Nigeria, were at the bottom of the GDP growth list.
The top performers of Niger with a 10,4% GDP growth and Senegal with an 8,3% growth over the last three years, were driven exclusively by oil & gas developments alone.
GDP Not The True Measure
Caution should be given to over-reliance on GDP figures in Africa to indicate growth and development status, as they are often off a really low base and, in particular, in smaller and predominantly resource-dependent economies.
Here, a single large investment or disinvestment or rapid rise in a particular commodity, such as we have seen in gold futures in 2025, can exacerbate or exaggerate GDP data and can make it seem either much worse or better than reality.
Single investment deals in African countries are often unable to stimulate a broader economic impact, particularly in mining, where the greater benefits are often in downstream manufacturing or beneficiation processes that are often only realised in other countries.
Infrastructure in Logistics – A Priority for Economic Growth
There needs to be a greater focus by countries in Africa to make sure that the environmental issues such as weak infrastructure and high logistical costs, as well as conflicts that create an unstable environment, as well as tax structures and labour laws can be a debilitating factor in attracting investments into downstream manufacturing so that these developments and investmentscan create real economic impact from mineral and other natural resources.
Examples Of Infrastructure Challenges:
South Africa’s major Port, Durban, handling 60% of South Africa’s container traffic, faced severe delays in 2024, with ships waiting up to 20 days to berth. This cost retailers millions, with congestion surcharges adding R98 million daily to logistics expenses, disrupting Black Friday and Christmas stock.
In Nigeria, only 30% of roads are paved, causing frequent delays and vehicle damage. A 2024 report noted that bad roads increase transport costs by 20-30% for Nigerian logistics firms.
Kenya’s logistics costs rose 25% in 2024 due to crumbling infrastructure, threatening 10,000 SME jobs, per a Nairobi-based trade group.
Jobs: The Key Development Indicator
GDP alone is an unreliable measure of welfare for countries. As an example of this, Russia, despite being in a war situation, is seeing GDP growth despite the lack of long-term sustainability.
For African countries, the major contributing factor to a healthy economy is whether jobs and longer-term employment are being created, and this is perhaps a better indicator of a healthy economy.
Africa has the youngest average population globally, and there are a plethora of challenges to getting this massive group meaningfully employed, where in places such as South Africa, unemployment for under-35-year-olds sits at above the 50% mark.
This unhealthy economic situation can only be addressed if there is a move towards a meaningful change in policy, infrastructure builds, to support cheaper and more effective logistics, and small business support.
