Artificial intelligence could become a major driver of economic growth across Sub-Saharan Africa, with the International Monetary Fund (IMF) estimating that the technology could expand the region’s economy by about 4% over the next decade. However, the global financial institution cautioned that realizing these gains will depend heavily on urgent investments in electricity, internet connectivity, and digital skills development.
According to a new IMF paper released on Tuesday, Sub-Saharan Africa currently ranks among the least prepared regions in the world for AI adoption. The report noted that inadequate infrastructure, limited access to digital technologies, and weak regulatory frameworks continue to slow progress, leaving many countries at risk of missing out on the economic opportunities presented by the rapidly growing AI industry.
Martin Schindler, Deputy Division Chief and Mission Chief in the IMF’s African Department, stressed that policy decisions made today will determine whether the region can fully benefit from AI. He warned that without meaningful reforms, productivity and economic growth gains could be as low as 0.2% over the next decade. Schindler described such a scenario as insignificant, emphasizing that Africa risks being left behind during one of the most transformative technological shifts of the modern era.
The IMF report highlighted electricity access as the most critical challenge facing the region. Nearly half of Sub-Saharan Africa’s population still lacks reliable power, making it difficult to support digital innovation and AI-driven services. Co-author Andrew Tiffin noted that data centres, which are essential for AI development, could also serve as catalysts for broader investments in power infrastructure. The report further revealed that internet usage across Africa stood at just 38% in 2024, far below the global average of 68%, while the continent hosts only around 160 data centres, with most concentrated in South Africa, Nigeria, and Kenya.
Despite these challenges, the IMF believes targeted investments could unlock significant opportunities. Expanding electricity access, strengthening broadband infrastructure, and improving digital literacy could help countries across the region adopt and scale AI technologies more effectively. As governments seek new engines of growth amid ongoing fiscal pressures, the report suggests that artificial intelligence may offer one of the strongest opportunities for economic transformation—provided the right foundations are put in place now.
source: nairametrics
