…The World Bank projects that artificial intelligence could add $1 trillion to Africa’s economy by 2035, but weak infrastructure, limited connectivity, poverty and skills shortages threaten the continent’s ability to capture the opportunity.
Africa is approaching a defining moment in its economic development. Artificial intelligence (AI) is opening new possibilities for productivity, job creation, innovation and public service delivery. Yet, the continent faces a fundamental challenge: its economic and technological infrastructure is not sufficiently developed to translate this promise into widespread prosperity.
The World Bank’s October 2026 Africa Economic Update, titled Building AI Readiness, presents a picture of significant opportunity constrained by persistent development gaps. It projects that economic growth in Sub-Saharan Africa will increase from 4.1 per cent in 2025 to 4.3 per cent in 2026. However, growth in income per person is expected to reach only 1.8 per cent, highlighting the difficulty of converting economic expansion into improved living standards.
The report’s most striking projection is that AI could contribute as much as $1 trillion to Africa’s gross domestic product by 2035 under an ambitious full-activation scenario. The technology could also create between 35 million and 40 million digital jobs and generate nearly $150 billion in annual tax revenue.
These projections are significant, but they are not guaranteed outcomes. Africa must first address the infrastructure, institutional and human-capital constraints that could prevent it from benefiting fully from the technology.
The scale of the challenge is evident in the numbers. About 900 million Africans remain offline, while the continent, despite accounting for 18 per cent of the global population, has only 0.6 per cent of worldwide data centre capacity. Just five per cent of African data centres are considered AI-ready.
The question is therefore not simply whether Africa will adopt AI, but whether it can build the foundations to develop, deploy and benefit from it.
The World Bank’s growth projection represents an upward revision of 0.3 percentage point from its April 2026 forecast. Nearly three-quarters of Sub-Saharan African countries have received improved growth projections, including Nigeria, Angola, Ethiopia and Zambia.
Stronger commodity demand, agricultural recovery, improved domestic consumption and structural reforms are supporting economic activity across the region.
However, the improvement in aggregate output does not necessarily mean that households are experiencing a corresponding improvement in their circumstances.
The report projects that per capita income will grow by 1.8 per cent in 2026, compared with 1.6 per cent in 2025. Growth is expected to average 2.0 per cent annually in 2027 and 2028.
These figures remain modest against the region’s substantial poverty and employment challenges. The proportion of people living below the international poverty line of $3 per day, measured in 2021 purchasing power parity terms, is projected to decline only slightly from 47.8 per cent in 2026 to 47.1 per cent in 2027.
More troubling is the expectation that the absolute number of people living in poverty will continue to rise.
This exposes a development paradox: African economies can expand while more people remain trapped in poverty. It also reinforces the need for governments to focus on the quality and distribution of growth, rather than relying solely on headline GDP figures.
Productive employment, education, healthcare, infrastructure and access to economic opportunities will determine whether economic expansion translates into better living conditions.
The region’s economic outlook is also threatened by renewed inflationary pressure.
After making progress in controlling prices, Sub-Saharan African economies are facing fresh challenges linked to geopolitical tensions in the Middle East. The World Bank estimates that median inflation will rise from 3.7 per cent in 2025 to 5.5 per cent in 2026.
Higher fuel, food and fertiliser prices are contributing to the pressure, particularly in countries that depend heavily on imported commodities.
The impact goes beyond rising consumer prices. Higher energy and transport costs increase production expenses, weaken household purchasing power and place additional pressure on businesses. Low-income households are particularly exposed because food and energy account for a significant share of their spending.
The World Bank expects inflation to moderate gradually to about 4 per cent by 2028, provided geopolitical tensions ease, commodity prices stabilise and governments maintain monetary and fiscal discipline.
Public debt presents another constraint. The median public debt-to-GDP ratio in Sub-Saharan Africa stabilised at 57 per cent in 2025, but the cost and structure of borrowing remain concerns.
Domestic borrowing has become the principal source of government financing since 2021, while external debt service has remained elevated at approximately 1.6 to 1.7 per cent of GDP.
Consequently, governments have less fiscal space to invest in infrastructure, education, healthcare and social protection.
Although the regional primary fiscal deficit declined from 3.1 per cent of GDP in 2020 to a projected 0.5 per cent in 2025, the overall fiscal deficit is expected to remain at 3.5 per cent in 2026.
This creates a difficult balancing act. African governments need to invest in the infrastructure and human capital required for long-term growth, but debt-servicing obligations continue to restrict available resources.
Artificial intelligence could become a major driver of Africa’s next phase of economic development.
The World Bank identifies the technology’s potential to improve productivity, create new businesses, strengthen public services and expand access to knowledge.
Under its full-activation scenario, AI could add up to $1 trillion to the continent’s GDP by 2035, create 35 million to 40 million digital jobs and generate almost $150 billion in annual tax revenue.
However, the report’s more conservative assessment suggests that, at current levels of preparedness, AI integration could contribute between 0.2 and 4 per cent of cumulative GDP over the next decade.
The difference between the projections demonstrates the economic cost of inadequate preparation.
Africa’s limited digital infrastructure is a major obstacle. Despite its population size, the continent accounts for only 0.6 per cent of global data centre capacity. Only about five per cent of its facilities can support advanced AI workloads requiring high-power density.
The continent also accounts for just two per cent of global AI training data, limiting the representation of African languages, cultures and economic realities in AI systems.
For example, Swahili has only 710 datasets on Hugging Face, compared with 88,844 for English.
This imbalance raises concerns about whether AI systems developed primarily with data from other regions can adequately address African needs.
Africa must therefore move beyond being a consumer of imported technology. It needs to develop local datasets, applications, research capacity and businesses capable of participating in the creation and commercialisation of AI solutions.
Nigeria has an important role in this emerging landscape. The World Bank identifies Nigeria, Kenya and South Africa as the principal centres of AI activity in Sub-Saharan Africa, accounting for much of the region’s innovation, venture capital investment, research output and advanced applications.
Among larger firms, AI adoption stands at 44 per cent in Nigeria and Kenya, compared with 61 per cent in the United States.
The report also highlights Nigeria’s introduction of Service-Wise GPT, an official AI assistant for federal civil servants designed to provide information on public service rules and procedures.
The initiative illustrates how AI can support government efficiency, improve access to institutional knowledge and strengthen service delivery.
However, Nigeria’s opportunity extends beyond deploying AI tools. The country needs reliable electricity, affordable broadband, accessible digital devices, computing infrastructure, locally relevant datasets and a workforce equipped with digital skills.
Although Nigeria is among Africa’s leading markets for colocation data centre capacity, the continent’s overall infrastructure remains small compared with global standards.
The challenge is to convert Nigeria’s growing technology activity into a stronger domestic ecosystem capable of developing solutions, attracting investment and creating high-value employment.
Concerns that artificial intelligence will eliminate jobs are also addressed in the World Bank report.
Its assessment suggests that AI is more likely to complement workers than replace them in the near term across much of Sub-Saharan Africa.
About 2.6 per cent of jobs in the region face near-term automation risk, compared with 14.2 per cent in high-income economies. Meanwhile, 15.2 per cent of jobs have the potential to be augmented by AI, allowing workers to become more productive.
However, these opportunities depend on access to technology. In Mali, for instance, only 1.2 per cent of workers are both employed in AI-exposed occupations and able to access AI.
Agriculture, healthcare, education, financial services, logistics and public administration offer opportunities for practical applications.
The report cites Farmerline’s Darli AI, which reached 110,000 farmers in more than 27 languages within eight months, as an example of locally relevant technology reaching underserved communities. Kenya’s M-Shule is also highlighted for its contribution to improvements in foundational literacy.
These examples demonstrate that African countries can use AI to address practical problems without immediately competing to develop the world’s most advanced models.
Technology alone cannot guarantee inclusive development. The World Bank identifies institutional capacity, regulation and governance as important elements of AI readiness.
Although 39 Sub-Saharan African countries have data protection laws and 45 have cybersecurity legislation, the region’s average score on the Oxford AI Governance Pillar is 41.6 out of 100, below the global average of 52.6.
The gap highlights the difference between adopting legislation and having the capacity to implement it effectively.
Governments need stronger regulatory institutions, technical expertise, transparent procurement, effective data governance and safeguards against discrimination and inappropriate automated decisions.
Regional cooperation will also be essential. Shared infrastructure, harmonised regulations and cross-border digital markets could reduce the high costs of data centres, research and specialised talent while helping African businesses reach larger markets.
The World Bank’s assessment presents a clear message: Africa’s economic future will depend on its ability to convert population growth, natural resources and technological change into productive opportunities.
The projected 4.3 per cent growth and potential $1 trillion AI dividend are encouraging. But they must be considered alongside the realities of widespread poverty, limited connectivity, inadequate data infrastructure and constrained public finances.
For Nigeria and other African economies, the priorities are clear: invest in electricity, broadband, education, digital skills, computing capacity and effective institutions.
The real measure of Africa’s AI progress will not be the number of applications adopted, but the jobs created, businesses strengthened, productivity gains achieved and people lifted out of poverty.
The $1 trillion opportunity is within reach, but capturing it will require deliberate investment, sound policies and sustained commitment to building the foundations of an inclusive digital economy.
