Productivity Engine or Digital Mirage? AI’s Potential for Economic Transformation in Africa

Africa stands at a critical economic crossroads. While growth is projected to accelerate to 4% by 2026, structural challenges including declining Official Development Assistance, commodity dependence, and low industrial bases underscore the urgency for sustainable productivity gains. Artificial Intelligence presents a significant opportunity to address this challenge. With the capacity to drive efficiency across sectors, AI adoption could inject $2.9 trillion into African economies by 2030, equivalent to a 3% annual increase in GDP. For Africa, harnessing AI is an economic imperative. To address these critical knowledge gaps, the International Development Research Centre (IDRC) and the UK’s Foreign, Commonwealth and Development Office (FCDO), through the Artificial Intelligence for Development (AI4D) programme, have launched a research initiative to generate actionable, locally grounded evidence on AI’s economic impact. Supported by diagnostic research from Genesis Analytics, the initiative focuses on four thematic areas. This brief examines productivity and economic transformation, highlighting the evidence needed to guide Africa’s position in the emerging AI-driven global economy.