-As Middle East Conflict Bites
WASHINGTON, June 2026 — Growth in Sub-Saharan Africa is projected to edge down to 4 percent in 2026, according to the World Bank’s latest Global Economic Prospects report, as the spillovers from the Middle East conflict offset gains from structural reforms and new trade agreements.
The region’s economy expanded by an estimated 4.1 percent in 2025, buoyed by higher commodity prices — especially for precious metals, copper, and coffee — along with easing inflation and gradual monetary policy loosening. But early 2026 data show those gains are under threat. While oil exporters like Angola and Nigeria are benefiting from higher energy prices, most of the region’s economies are energy importers.
Rising fuel, fertilizer, and transport costs are reigniting inflation, stalling the disinflation process that had taken hold last year. In April, annual headline consumer inflation reaccelerated. “The impact of the Middle East conflict — through higher commodity prices and weaker external demand — is overwhelmingly negative for most of the region,” the report said.
Growth forecasts for 2026 have been revised down by 0.3 percentage point since January. Governments across Sub-Saharan Africa are struggling to respond. Ethiopia and Ghana have expanded temporary fuel subsidies, Angola has delayed planned subsidy reforms, and Senegal has adjusted administered prices. But these measures are widening deficits and increasing borrowing, leaving fewer resources for vulnerable households.
Monetary policy is expected to remain tight, with central banks having limited ability to look past inflation shocks. High borrowing costs, reduced concessional financing, and declining official development assistance are adding to fiscal pressures — especially in economies that have been slower to improve policy frameworks. Some positive developments offer partial relief.
The United States extended the African Growth and Opportunity Act through end-2026, and China eliminated tariffs on all African imports. Deeper intraregional trade through the African Continental Free Trade Area is also expected to support export industries. Structural reforms are gaining traction in several large economies. South Africa is improving energy availability, while Ethiopia and Nigeria have moved on exchange-rate liberalization, public financial management, and business-friendly measures.
Yet these efforts will only partly offset global headwinds. Growth for industrial commodity exporters is forecast to rise only marginally — from 3.1 percent in 2025 to 3.2 percent in 2026. Non-resource-rich economies will see growth slow from 6.4 percent to 5.7 percent this year, though they will continue to outpace commodity-dependent nations. The report flags notable forecast cuts. Uganda’s outlook was lowered due to oil project delays.
Senegal faces a freeze in IMF funding following revelations of hidden debt. Côte d’Ivoire’s growth is weighed down by falling cocoa prices. Nigeria and South Africa continue to struggle with structural constraints. Real per capita GDP growth in the region is projected to remain at just 1.6 percent in 2026 — far too low to make a substantial dent in extreme poverty. Job creation is lagging behind one of the world’s fastest-growing labor forces, and food insecurity in fragile and conflict-affected states is at its highest level since the early 2000s.
Adding to the challenges, the third-largest Ebola outbreak on record was reported in eastern Democratic Republic of the Congo in May 2026, with imported cases confirmed in Uganda. The decline in official development assistance is expected to deepen such health and humanitarian crises. “Growth in Sub-Saharan Africa is forecast to recover to 4.4 percent on average in 2027–28,” the World Bank said, “but this assumes the geopolitical environment stabilizes in the near term and security improves in fragile states.”
