IMF: Africa’s Growth Remains Strong As Inflation Eases And Reforms Advance

Africa’s economy continues to show resilience despite persistent global headwinds, supported by moderating inflation, stronger policy frameworks, and ongoing structural reforms, according to the International Monetary Fund (IMF).

The IMF’s outlook followed a high-level meeting with African finance ministers and central bank governors in Washington during the 2025 African Caucus session, held alongside the IMF-World Bank Annual Meetings.

In a joint statement, IMF Managing Director Kristalina Georgieva and Hervé Ndoba, Central African Republic’s Finance Minister and Chair of the African Caucus, noted that Africa’s growth is projected to remain steady at 4.2% in 2025, the same rate recorded in 2024. Inflation is expected to ease to an average of about 4%, while debt levels have stabilised at roughly 65% of GDP.

The IMF acknowledged that the continent continues to operate in a challenging global environment marked by slowing global growth, protectionist trade policies, geopolitical tensions, and limited access to affordable financing. Climate shocks have also intensified, cutting output by as much as two percentage points annually in some of Africa’s most vulnerable economies.

Despite these pressures, the Fund observed progress in fiscal and structural reforms. Governments have maintained policy discipline while pursuing initiatives to strengthen fiscal transparency, expand tax revenues, and improve public financial management. Many countries are implementing medium-term strategies that balance fiscal consolidation with growth-oriented investments.

The African Caucus reaffirmed its commitment to preserving macroeconomic and financial stability, while advancing policies aimed at improving living standards through job creation, social inclusion, and sustainable growth.

Efforts to boost domestic revenue mobilisation remain central to these reforms, driven by tax digitalisation, better governance, and anti-corruption initiatives. These measures are designed to enhance efficiency, improve revenue collection, and ensure public spending achieves measurable results.

The IMF also highlighted the mounting financial pressure on low-income countries, where interest payments now consume around 15% of government revenues. Fragile and conflict-affected states continue to face deep economic strains, with several yet to recover to pre-pandemic income levels.

To address financing constraints, the IMF has restructured its Poverty Reduction and Growth Trust (PRGT) to expand concessional lending capacity—estimated at SDR 5.2 billion (US$7.1 billion) annually, including zero-interest loans for the poorest nations. Additionally, the Resilience and Sustainability Trust (RST) has approved 26 programs, nearly half of them in Africa, to support structural transformation, climate resilience, and health system preparedness.

The statement called for continued global support to ensure that both trust facilities remain adequately funded.

Reaffirming the Fund’s commitment, Georgieva said the IMF remains dedicated to helping African nations create fiscal space for investments in infrastructure and human capital. She added that the Fund would continue adjusting its tools and policy advice to help countries navigate economic challenges while advancing long-term development goals.