Middle East Conflict Could Slash Africa’s Economic Growth by 1.5% – AfDB Warns
The African Development Bank (AfDB) has cautioned that the ongoing conflict in the Middle East could significantly affect Africa’s economic growth, potentially reducing it by up to 1.5% if the crisis continues for six months or longer. Kelvin Urama, the bank’s Chief Economist, highlighted these risks during the launch of the 2026 Africa’s Macroeconomic Performance and Outlook (MEO) report on Monday.
While the immediate effects may be moderate, the AfDB notes that the conflict adds pressure to an already fragile economic landscape across the continent, characterized by rising public debt, declining foreign investment, and shrinking development assistance. “If the war continues for up to six months, we might see about a 1.5% decline,” Urama said, stressing that longer disruptions could worsen Africa’s economic stability.
Rising oil prices resulting from the conflict are also impacting African economies unevenly. Oil-exporting nations may see some short-term benefits, but the overall effect is inflationary, driving up the cost of fuel, food, and fertilizer. This has led to currency depreciation in nearly 29 African countries and increased the cost of living for millions. The AfDB’s report warns that these challenges compound Africa’s existing vulnerabilities, including $1.9 trillion in public debt and seven countries already in debt distress.
Foreign investment and aid are also under strain. The bank highlighted a 42% decline in foreign direct investment flows in the first half of 2025, alongside cuts in foreign aid that threaten critical health, education, and social programs. With debt servicing taking up more than 31% of government revenues, many African nations are left highly sensitive to global shocks.
Despite these pressures, the AfDB remains cautiously optimistic, maintaining its growth projections for the continent at 4.3% for 2026 and 4.5% for 2027. Regional forecasts from the International Monetary Fund and the World Bank also indicate modest recovery trends, with Nigeria’s growth forecast set at 4.4% for 2026 and 2027. Analysts stress, however, that much depends on how long the Middle East conflict continues and how resilient African economies remain to the ripple effects of global instability.
source: Nairametrics