Challenges to Development in Sub-Saharan Africa

Sub-Saharan Africa faces a complex web of challenges that hinder its development and progress. The COVID-19 pandemic has further exacerbated these issues, potentially undoing years of economic and social advancements. As the global economy rebounds, the region risks falling further behind.

Economic Challenges

Sub-Saharan Africa is projected to be the world’s slowest-growing region in 2021, with an expected growth rate of 3.4 percent. This growth is buoyed by the global recovery, increased trade, higher commodity prices, and a resumption of capital inflows. However, the recovery in sub-Saharan Africa is expected to lag behind the rest of the world with a cumulative per capita GDP growth over the 2020-25 period projected at 3.6 percent, substantially lower than in the rest of the world (14 percent).

The pre-crisis divergence between resource-intensive and non-resource-intensive countries in sub-Saharan Africa will persist. Non-resource dependent countries are forecast to see average per capita incomes rise by 21.6 percent by 2025.

The COVID-19 crisis is expected to undo years of economic and social progress and leave lasting scars on the region’s economies. The number of people in sub-Saharan Africa living in extreme poverty is projected to have increased by more than 32 million in 2020; the number of missed school days is more than four times the level in advanced economies; and employment fell by around 8.5 percent in 2020. In terms of livelihoods, per capita income has returned to 2013 levels.

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Private sector balance sheets were also hit hard by the pandemic. Declining revenues and output, vulnerabilities and less room to spend contributed to the problem.

Debt and Fiscal Issues

External debt service has more than doubled over the past decade, reaching 2 percent of GDP in 2024. The number of Sub-Saharan African countries in or at high risk of debt distress has nearly tripled, rising from eight in 2014 to twenty-three in 2025-nearly half of the region.

Nearly 40% of sub-Saharan African countries are at risk of slipping into a major debt crisis, according to the Brookings Institution. As debt levels increase, so does the pressure of servicing the debt; money that could be invested in society goes to repaying loans. This could make it less likely that the region can achieve the African Union’s Agenda 2063 development targets. Framework on debt can be helpful in this regard.

More prudent and consistently implemented fiscal frameworks can help address poor resource management challenges-and also help ensure growth is more resilient going forward.

Social and Demographic Challenges

The population of sub-Saharan Africa is currently growing at a rate of 2.7% each year. Strides made with regard to tackling infant mortality, in addition to a greater number of women of childbearing age, are partly responsible for this significant growth, which is currently slowing down. But this dynamic obscures another reality, which is that mortality rates remain high in both West and Central Africa, while the increase in life expectancy slowed down considerably over the last decades of the 20th century. In 2023 this was estimated at 61 south of the Sahara, with regional variations: from 58 in West Africa to 64 in East Africa.

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There are a range of reasons for this: the re-emergence of malaria, healthcare systems weakened by economic crises, political conflict, etc. The HIV/AIDS epidemic also had a dramatic impact on the mortality rate in a number of countries in Southern and East Africa, which had been the most advanced in terms of life expectancy. However, progress in health has recovered in the majority of countries over the course of the past two decades, due in no small part to better treatment with antiretroviral drugs, which has helped to considerably reduce deaths from HIV.

With regard to fertility rates, in certain countries these remain relatively high, enough to supply an agricultural production system which requires a large workforce, but infant mortality is high. Such rates come as no surprise given the severe levels of poverty. These are the countries with the highest mortality rates, both for children and adults, which explains the high fertility rate: the more children a couple have, the greater the likelihood that at least one of them will be alive and solvent by the time they need their help. Children provide a form of insurance policy for their parents.

Urbanization

As the population continues to age, the demographic shift in sub-Saharan Africa has seen its urban population triple. This intense growth presents unprecedented challenges from a town planning perspective. Indeed, 62% of city-dwellers in sub-Saharan Africa live in substandard housing with no access to water or sanitation and where there is no waste disposal, particularly for non-biodegradable waste. Not only is this detrimental to people, but it also harms the environment.

Urbanization is infringing upon ecosystems, destroying biodiversity. Owing to a lack of appropriate development and planning, towns and cities suffer substantial human and material damage during floods. As a result, this phenomenon of metropolization in sub-Saharan Africa, encompassing all of these factors, is exacerbating social, economic and health inequality, leading to injustice from a health and socio-environmental perspective.

More impactful town planning policies and greater investment in infrastructure are needed in response to the rapid urban growth in Africa. These can and should be seen as strategic levers for delivering sustainability for increasingly complex and uncertain towns and cities.

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Migration

The majority of migrants from sub-Saharan African countries remain within the region. In 2020, 63 out of every 100 migrants from sub-Saharan Africa remained within sub-Saharan Africa. This data contradicts portrayals of African migration, which is incorrectly believed to be high, on the rise and caused by poverty, with most migrants drawn to rich countries.

Youth mobility is also creating opportunities. The primary motivation is economic, the goal being to generate additional income on top of agriculture, which is no longer enough to feed families. Through mobility, young people now say that they are also able to cover the costs of new requirements resulting from education and urbanization (phones, fabrics, haircuts, school supplies, etc.). For women, migration enables them to acquire greater autonomy, changing the role they occupy in households. It gives them a say in how the money they earn is used, although it is primarily spent on family necessities.

Temporary migration is no longer seen as an aberration for migrants or the societies they come from, but rather a factor of resilience in response to the need to diversify income sources and adapt to socio-cultural changes. Although temporary migration is often seen as a short-term strategy for addressing short-term needs, it can also have consequences in the longer term, enabling investment in education for younger siblings, for example.

Increased regional migration and resulting xenophobia, as well as government crackdowns on opposition parties, may also contribute to insecurity.

Environmental Challenges

Africa is expected to be one of the continents hardest hit by climate change, with increasing extreme weather events threatening the health of its people and economies. At the same time, mass-migration as a result of flooding or droughts could put resources such as food, water and housing under pressure in areas less affected.

More frequent severe weather coupled with other environmental stressors, such as poor land management and urban planning, could lead to increased instability, conflict, and migration. The economic, social, and political implications of the pandemic are likely to exacerbate already complex and varied security dynamics across the continent.

The climate emergency could provide an opportunity for rural societies to move away from activities which are significantly dependent on external variables. Rural populations may be able to develop long-term resilience strategies out of this dangerous situation.

Governance and Political Instability

Corruption continues to undermine Africa’s economic, political, and social development and fuels mistrust in government. The increasing public pressure on governments is driving a new round of circumvented term limits, manipulated elections, and suppression of independent media and civil society. These trends probably will be amplified in the next two years as the pandemic provides some leaders with additional pretexts to enact harsher security measures and regulations.

Lack of Domestic Stability in Key Regions. In the next five years, the trajectory of internal conflict within Ethiopia, Nigeria, and Sudan will be critical to Sub-Saharan Africa’s regional stability and overall economic outlook.

"Failure of national governance" is a leading risk to business, according to executives in sub-Saharan Africa. The political changes taking place offer an opportunity to address citizens’ concerns and priorities. However, leaders - and economies - will face considerable risk should policy agendas fail to deliver results.

Health and Education

Improvements across an array of development indicators in Sub-Saharan Africa are leveling off or in some cases reversing. Many governments now consistently struggle to provide access to safe water, food, electricity, and other basic needs.

African countries are unlikely to attain the UN’s Sustainable Development Goal of universal primary and secondary education by 2030 because of stagnated funding, lack of trained teachers, and pandemic-related complications. Girls probably will be slower than boys to return to the classroom as schools reopen across the region, judging from data on school attendance following the West Africa Ebola crisis.

Education will be vital to meeting a number of the sustainable development goals, helping people to break free of the poverty cycle and reducing social and gender inequality. But according to the UN, sub-Saharan Africa is facing massive challenges to provide schools with basic resources. The situation is extreme in primary and early secondary, where fewer than half of schools have access to clean water, electricity, computers and the internet.

The gap between girls and boys in terms of access to education is narrowing, giving women greater access to skills and employment opportunities. However, this has yet to have much of an impact on gender inequality. South of the Sahara, the employment rate for women is very high compared to elsewhere in Africa: according to the International Labour Organization, more than 60% of women between the ages of 15 and 64 are employed in some form of economic activity, three times higher than in North Africa.

Despite the considerable progress made over the past few decades when it comes to educating young girls, their employment remains limited to the informal economy, largely avoiding tax and legal requirements.

Trade and Economic Integration

Making Progress Toward Integration. Despite these setbacks, Africa’s collective stature in the global economy is likely to increase in the coming years as the African Continental Free Trade Area (AfCFTA) comes into effect early this year. The AfCFTA presents an opportunity for the region’s governments to better navigate the near-term effects that COVID-19-related travel restrictions and uncertainty in tariffs and exchange rates have had on the business environment.

The development of trade flows with non-traditional trading partners such as Saudi Arabia, Singapore, Turkey and the United Arab Emirates is likely to enhance export volumes from Sub-Saharan Africa to these destinations and diversify the region's trade relationships over the medium term. This diversification of trade partners offers several advantages, including reduced dependence on a limited number of traditional markets, increased resilience against economic fluctuations, and access to new investment opportunities and technologies.

Unleashing sub-Saharan Africa’s considerable potential requires bold and transformative reforms.

Key Risks Impacting the Region

The report highlights five interconnected risks impacting countries across the continent.

1. Unemployment and underemployment: Unemployment in sub-Saharan Africa stands at around 6%, according to the International Labour Organization. But most of the work available is unskilled or low-skilled, in part because the region has the world’s lowest levels of access to higher education.
2. Underinvestment in infrastructure: A lack of funding for roads, telecommunications, water, electricity and more are impeding the continent’s productivity by around 40%, according to World Bank estimates.
3. Fiscal crises: Nearly 40% of sub-Saharan African countries are at risk of slipping into a major debt crisis, according to the Brookings Institution.
4. Political change: "Failure of national governance" is a leading risk to business, according to executives in sub-Saharan Africa.
5. Climate change: Nine out of the ten countries in the world most vulnerable to climate change are in sub-Saharan Africa.

Inequality

Despite notable economic growth over the past three decades, Sub-Saharan Africa continues to host seven of the world’s ten most unequal countries. Wealth and income disparities in the region are among the most pronounced globally. For example, in 2019, the richest 10% of the African population earned 54% of total income, while the bottom 50% accounted for a mere 9%. This stark imbalance underscores the non-inclusive nature of economic growth in the region, leaving millions of people excluded from its benefits.

The inequality is not limited to income. It encompasses disparities in education, health care, access to technology, and gender equality. Addressing gender disparities is crucial to reducing overall inequality and empowering communities to thrive.

Real-World examples of inequality and response initiatives:

• South Africa: The country is often cited as the most unequal globally. Despite being one of Africa’s largest economies, it struggles with an unemployment rate exceeding 30%, limited access to quality education for low-income communities, and pronounced racial disparities that remain from apartheid.
• Kenya: Regional disparities in health care access are stark. While urban centres like Nairobi boast well-equipped hospitals, rural areas often lack basic medical facilities. This gap contributes to higher maternal mortality rates and limited treatment for preventable diseases.
• Nigeria: As Africa’s most populous country, Nigeria illustrates the intersection of wealth inequality and insecurity. Oil wealth is concentrated among the elite, while regions like the Northeast face extreme poverty, exacerbated by the ongoing conflict with Boko Haram.

Efforts to address these issues are underway, led by both local and international organisations. The African Centre of Excellence for Inequality Research (ACEIR) conducts interdisciplinary research to understand inequality’s root causes and suggest evidence-based policies. Similarly, the EU-AFD Research Facility on Inequalities provides funding and expertise to help governments implement more equitable policies.

The Way Forward

Achieving equitable development in Sub-Saharan Africa will require bold, coordinated actions at local, national, and international levels. Governments must prioritise inclusive policies that redistribute wealth, enhance access to quality services, and protect the most vulnerable populations. International organisations and donors must align their efforts to support locally-driven solutions and empower communities.

Finally, fostering a culture of accountability and transparency is essential to ensure that resources are used effectively and equitably.

Variables that may drive the continent’s economic trajectory beyond a five-year time horizon include the scale and duration of the global economic recession, the future of foreign direct investment, international willingness to forgive or forestall servicing African debt past the immediate crisis, and the change in commodity prices.

Improvements across an array of development indicators in Sub-Saharan Africa are leveling off or in some cases reversing. Many governments now consistently struggle to provide access to safe water, food, electricity, and other basic needs.

Sub-Saharan Africa’s growth and stability trajectories will be influenced by how external actors-including China, Europe, the Gulf states, and Russia-prioritize and coordinate their economic, political, development, and security activities for Africa during the next five years.

African agency and influence in international affairs have been on the rise during the past decade, both at a continent level and bilaterally, a trend that is likely to continue in the next five years, particularly with the increased efforts for continental integration. On the continental level, African governments may be able to work as a bloc to engage larger countries and international entities more effectively.