By Baboloki Semele — African economies are under intensifying external pressure from rising debt burdens, dwindling aid flows, inflation shocks, and growing geopolitical instability. This was the stark warning delivered by Claver Gatete, Executive Secretary of the Economic Commission for Africa (ECA), in a high-level briefing to the Africa Group of ambassadors at the United Nations Headquarters in New York. Addressing diplomats at the Permanent Mission of the African Union to the UN, Mr. Gatete painted a sobering picture of the continent’s macroeconomic outlook, cautioning that despite signs of recovery, economic fragility remains widespread. Real GDP growth across Africa is projected between 2.9% and 3.6%, yet more than half of the continent’s countries are weighed down by public debt exceeding 60 per cent of GDP. Seven nations are officially in debt distress, while eleven others teeter on the edge, facing high risk.
Currency devaluations have added fuel to the fire. Nigeria’s naira has plunged by nearly 95 per cent between 2023 and 2024, while Egypt has seen its currency drop by 50 per cent over the same period. The average fiscal deficit across the continent has widened to 5.1 per cent of GDP, signalling a growing inability to meet public spending needs.
“External financing is drying up, but the pressure on government budgets keeps growing,” Mr. Gatete told attendees. “We cannot overstate the urgency of domestic resource mobilization.”
This fiscal squeeze is exacerbated by declining development assistance. Official Development Assistance (ODA) has plummeted to 2.1 per cent of donor Gross National Income in 2023, a sharp fall from 3.4 per cent in 2006. Even more concerning are announcements from key donors such as the United States, the United Kingdom and Germany of further aid cuts, adding strain to countries already struggling to stabilize their economies.
On the trade front, new protectionist measures by developed economies are beginning to take their toll on African exports. A forthcoming joint report by ECA, the African Union Commission, and the African Development Bank projects that newly proposed U.S. import tariffs could slash Africa’s exports to the United States by as much as 21.5 per cent. The implications are far-reaching—not only for trade volumes but also for industrial employment, regional supply chains and Africa’s global bargaining power.
“This goes beyond trade volumes,” Mr. Gatete emphasized. “It affects industrial jobs, regional supply chains and Africa’s voice in shaping the terms of engagement.”
In response to these mounting challenges, the ECA has stepped up efforts to strengthen domestic policy instruments and institutions. Mr. Gatete cited examples of recent technical assistance, including property tax assessments in Ethiopia, transfer pricing audits in Mauritania, and customs training under the AfCFTA for East African countries. These initiatives are part of a broader ECA agenda to support Member States in achieving debt sustainability, fiscal modernization, and full implementation of the African Continental Free Trade Area.
Additionally, the ECA is contributing to global economic governance reform, serving as a knowledge partner to South Africa’s G20 presidency. It is working closely with the African Union and multilateral development banks to advance proposals on reforming special drawing rights, expanding access to blended finance, and ensuring Africa has a stronger voice in the global financial system.
Mr. Gatete stressed that building technical capacity is not enough, adding that it must be matched with political coordination. “Africa’s voice must be coherent, coordinated and grounded in evidence,” he said, calling for tighter alignment between African permanent missions in New York and Addis Ababa and the regional institutions that offer critical support to national governments.
“This is a moment that demands unity of purpose and credibility of message,” he said, urging African leaders to use homegrown expertise and data as the foundation for economic diplomacy and development strategies.
Joining the discussion virtually was Mr. Stephen Karingi, Director of ECA’s Macroeconomics, Finance and Governance Division, who echoed Mr. Gatete’s call for evidence-based action and policy coherence across African institutions.
Held on the sidelines of the High-Level Political Forum, the session served as a timely reminder of the economic storm clouds gathering over the continent and the urgent need for African-led responses rooted in resilience, coordination and reform.