Africa’s Pulse Key Messages

Macroeconomic Update: Amid its first recession in 25 years, Sub-Saharan Africa is poised
for recovery.
• Economic growth in Sub-Saharan Africa is estimated to have contracted by 2.0% in
2020, closer to the lower bound of the World Bank’s forecast in April 2020.

• A slower spread of the virus and lower COVID-19-related mortality, strong agricultural
growth and a faster-than expected recovery in commodity prices has helped many
African economies weather the economic storm induced by the COVID-19 pandemic.

• Prospects for recovery are strengthening amid actions to contain new waves of the
pandemic and speed up vaccine rollouts.

• Growth in the region is forecast to rise between 2.3 and 3.4% in 2021, depending on the
policies adopted by countries and the support of the international community including
increased concessional financing, access to vaccines and a solution to the debt crisis. A
second wave of COVID-19 infections is partly dragging down the 2021 growth
projections, with daily infections about 40% higher than during the first wave.

• Real GDP growth for 2022 is estimated at 3.1% but could be as high as 4.5% and
sustained over 4 percent going forward from 2022 if countries continue deepening
reforms that create jobs, encourage investment, protect the vulnerable, and enhance
competitiveness.

• The resurgence of the pandemic in late 2020 and limited additional fiscal support will
pose an uphill battle for policy makers as they continue to work toward stronger growth
and improved livelihoods for their people.

• Sub-Saharan Africa’s recovery is expected to vary across countries. Non-resource-

intensive countries, such as Côte d’Ivoire and Kenya, and mining-dependent economies,
such as Botswana and Guinea, should see robust growth in 2021, driven by a rebound in
private consumption and investment as confidence strengthens and exports increase.

• In Eastern and Southern Africa, the growth contraction for 2020 is estimated at -3.0%,
mostly driven by South Africa and Angola, the subregion’s largest economies. Excluding
Angola and South Africa, economic activity in the subregion is projected to expand by
2.6% in 2021, and 4.0% in 2022

• Growth in Western and Central Africa contracted by 1.1% in 2020, less than projected in
October 2020 partly due to a less severe contraction in Nigeria, the subregion’s largest
economy, in the second half of the year. Real gross domestic product in the Western and
Central Africa subregion is projected to grow 2.1% in 2021 and 3.0% in 2022.
COVID-19 and the Future of Work
• Digital technologies are helping to create new jobs, and to make existing jobs more
productive across Africa.
• Digital technologies are increasing employment opportunities for people at all skill and
education levels in Africa – benefits are not limited to the privileged.
• Digital transformation depends on effective infrastructure investment, regulatory
frameworks, and skills provision, with young people as a catalyst to drive progress.
• African countries have not wasted the opportunity of the COVID crisis.
o Most firms have increased their connectivity to digital tools and more people are
using e-commerce across Africa in the last year.
o Of the Sub-Saharan African firms surveyed in 18 countries, the report reveals that
22% either started or increased their use of digital platforms, social media, and the
internet in response to the pandemic. Seventeen percent of the firms invested in
new equipment, software, or digital solutions.
o Use of digital platforms was the highest in Togo (43%) and South Africa (51%).
o Employment among informal firms using digital management solutions was 1.6
times that of nonusers, and the average wage of firms using digital transaction
technologies was 1.5 to 2.4 times that of nonusers.
o firms in sectors with a greater share of tasks/jobs that can be performed from
home were more likely to have increased their use of digital platforms in their
businesses.
▪ Sub-Saharan African firms in financial and ICT services were the most
likely to use of digital platforms in response to the pandemic shock (40
and 39%, respectively). More than one-quarter of the firms in retail and
wholesale trade started or increased their use of digital platforms.
▪ Firms in agriculture, construction, accommodation services, and
manufacturing were less prone to have expanded their use of digital
platforms (less than 20%).
• Growth was particularly notable for e-commerce. For example, African platform Jumia
saw an increase of more than 50%, from 3.1 million to 4.7 million, in the volume of
transactions during the first six months of 2020, compared with the same period in 2019.
• Africa’s Pulse examined whether Sub-Saharan African countries are ready to take
advantage of digital opportunities, assessing internet readiness along five dimensions:
national ICT strategy, business environment, infrastructure, financial capital, and ICT
skills base.
o The evidence shows that all the countries in the region, except South Africa, have
low scores on their ICT skills base readiness to leverage internet opportunities.
o Furthermore, the ICT skills base is the dimension with the poorest performance
across countries in the region.