IMF Highlights AI’s Potential to Boost Growth Across Sub-Saharan Africa

An International Monetary Fund (IMF)  report has identified artificial intelligence (AI) as a key opportunity for accelerating productivity and economic growth across Sub-Saharan Africa, while warning that infrastructure, digital connectivity and skills gaps could limit the region’s ability to fully benefit from the technology.

In its departmental paper, Unlocking the Potential: AI in Sub-Saharan Africa, the IMF said AI has the potential to transform productivity, labour markets and long-term economic growth. However, the report noted that the region’s challenge is not the emergence of AI itself, but its ability to adopt, adapt and scale the technology quickly enough to avoid falling further behind global productivity trends.

According to the IMF, under current conditions—including low AI adoption, limited infrastructure and a workforce concentrated in sectors such as agriculture—AI is expected to raise productivity by only 0.2% and increase cumulative GDP growth by around 0.4% over the next decade. The report said that under a high-adoption scenario, where structural constraints are addressed and AI is integrated more broadly across industries, productivity gains could increase to about 2.1%, contributing roughly 4% to cumulative GDP over the same period.

The report identified unreliable electricity as one of the region’s most significant barriers to AI adoption, noting that nearly half of Sub-Saharan Africa’s population lacks access to electricity. Frequent power outages continue to affect businesses and present a major obstacle to operating AI infrastructure such as data centres. The IMF also highlighted limited internet access, low mobile broadband and smartphone penetration, and the high cost of mobile data as key challenges slowing digital adoption.

Beyond infrastructure, the report pointed to shortages in skilled talent, low enrolment in science, technology, engineering and mathematics (STEM) programmes, limited access to high-performance computing resources and an AI-related brain drain as factors constraining innovation. It also noted that fragmented venture capital ecosystems continue to limit the development and scaling of locally developed AI solutions.

Despite these challenges, the IMF said AI is already demonstrating value across several sectors. In agriculture, AI-powered mobile and SMS advisory platforms are helping smallholder farmers improve crop management, pest control and irrigation, with pilot projects recording double-digit improvements in yields and incomes. The report also highlighted growing AI applications in education and healthcare, where the technology is being used to support personalised learning, improve clinical diagnostics and strengthen medical supply chains.

The IMF added that governments could also use AI to enhance public administration through improved domestic revenue collection, customs management and public service delivery.

While highlighting AI’s development potential, the report cautioned that unequal access to technology could widen existing economic and social inequalities if the benefits remain concentrated in urban centres and among highly skilled workers. It also warned that weak regulatory frameworks expose countries to risks including data privacy breaches, algorithmic bias, cybersecurity threats, misinformation and digital fraud.

To maximise AI’s benefits, the IMF recommended a phased policy approach focused on expanding reliable electricity and digital infrastructure, investing in digital skills and human capital, strengthening local data ecosystems, and introducing risk-based AI regulations. The report also emphasised the importance of greater regional cooperation to harmonise standards, pool resources and create the scale needed for Sub-Saharan Africa to compete effectively in the global digital economy.