In a year of gloomy global headlines, East Africa – and indeed the continent – has offered a rare stretch of good news. In less than a month, the region witnessed several breakthroughs with consequences that extended far beyond its borders.

 

On August 22, 2025, S&P upgraded Kenya’s long-term sovereign credit rating from "B-" to "B" with a stable outlook.

The upgrade followed, among other things, Kenya’s successful completion of its Eurobond buyback in February 2025, which eased fears of a near-term default.

This still places Kenya in the "speculative grade" (sometimes referred to as junk territory), but it indicates a lower risk of default compared to its previous rating. Additionally, it could signal to lenders that East Africa (at least) is not yet on the brink of the debt abyss.

Up north, Ethiopia signed a $2.5 billion agreement with Nigeria’s Dangote Group on August 28, 2025, to construct one of the world's largest single-site fertiliser plants in Gode, Somali Regional State.

Given that fertiliser use in sub-Saharan Africa is less than 20 kilogrammes per hectare, compared to the global average of 135kgs, the deal has the potential to be one of the turning points for African farming.

In Yokohama, Japanese Prime Minister Fumio Kishida unveiled a fresh package for Africa under the Tokyo International Conference on African Development (TICAD), which ended on August 22.

He announced an ambitious new African initiative—including $30 billion in support and new technology-sharing programmes—that targeted green energy, support for start-ups, and training 10,000 African youth in AI and digital skills.

Crucially, TICAD also endorsed the creation of an Indian Ocean economic zone, tying East Africa’s ports more closely to Asian markets. It complements India’s surging commerce across the ocean, linking Mombasa and Dar es Salaam to Mumbai and Chennai, and reinforces the continent's role in a new economic arc from Africa's east coast to South Asia.

The idea, once in vogue until about 2016, that Africa’s East Coast could become a hub in a global maritime economy, might soon be revived. And Japan, likely anxious about Chinese dominance and Europe’s retreat, views the Indian Ocean – now the world's fastest-growing trade basin, with East Africa as its western anchor – as the next frontier of strategic trade.

In Europe, Britain and France remain mired in poor growth and inflation, which weakens demand for African exports such as tea, coffee, and leather.

Oil sits around $78 a barrel, well below the $100–110 that countries like Nigeria and Angola need to balance their budgets. Copper hovers near $8,500 per tonne, a squeeze for Zambia and the Democratic Republic of Congo, where the metal pays salaries and keeps schools open.

Yet, even in this storm, Africa is not without cushions. The continent’s GDP is now close to $3 trillion, making it collectively the world's eighth-largest economy.

It is urbanising at breakneck speed—over 43 percent of Africans now live in towns and cities, up from just 31 percent at the turn of the century.

Internet penetration has doubled in less than a decade, rising from 26 percent in 2015 to nearly 50 percent in 2024, fuelling new industries and connecting rural farmers to mobile markets. Mobile money, pioneered here, now processes transactions worth over $800 billion annually.

Debt remains heavy — Africa owes about $690 billion externally —but the old aid dependency is fading. A decade ago, official development assistance accounted for 37 per cent of government revenues; by 2022, it had decreased to 26 percent.

Amid these contrasts, quiet hope lies in the ground and the skies. Africa holds 60 percent of the world's best solar resources, yet only 1 percent of global solar capacity is installed here.

The International Energy Agency estimates the continent could generate more than 10 terawatts of solar power—enough to light up every African home, factory, and school several times over.

In a world choking on climate anxiety, that untapped potential is Africa's trump card. It is not just a future promise—it is already visible in Morocco, where the Noor solar complex powers a million homes.

Across the continent, investments in green energy are increasing. Kenya and Algeria have seen some of the most dramatic surges in green energy among African nations: Kenya’s solar share jumped from just 2 percent in 2015 to 27 percent by 2019, one of the fastest growth rates globally.

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