Kigali, 23 July 2026 (ECA) – The UN Economic Commission for Africa (ECA) convened an online Policy and Programme Dialogue to discuss the findings of its latest Macroeconomic and Social Overview Report 2026, titled “Eastern Africa's Balancing Act: High Growth, Tight Budgets, and Rising Uncertainty.”
Mr. Andrew Mold, Director of the ECA Office for Eastern Africa, presented the report's main findings. He stressed that economic growth in Eastern Africa remains one of Africa's fastest-growing regions, with growth projected at around 5.8 per cent in 2026 compared with 4.0 per cent for Africa as a whole and 1.6 per cent for developed economies globally.
Despite the region's strong economic performance, Mold warned that policymakers are simultaneously grappling with severely constrained budgets.
"Eastern Africa remains one of the world's fastest-growing regions, but sustaining that momentum requires navigating increasingly tight fiscal conditions, elevated debt burdens and a highly uncertain international environment," said Mr. Mold.
The new report shows that growth momentum remains broadly sustained across the region. Rwanda recorded 10 per cent GDP growth in the first quarter of 2026, while Tanzania grew by 5.7 per cent, Kenya by 5.3 per cent, Uganda by 5.8 per cent, and Burundi by 3.4 per cent. Services continue to be the leading driver of growth, complemented by a strong growth in the construction sector. On the other hand, the manufacturing sector has generally been quite sluggish, and agriculture continues to underperform, with the notable exception of export crops.
The report highlights some encouraging macroeconomic trends, particularly a significant moderation in inflation, strong export performance and a degree of stabilization in fiscal deficits. By mid-2026, rates had stabilized in the single digits across much of the region, including in Kenya (4.7 percent), Tanzania (4.2 percent), and Uganda (3.2 percent), and on a downward trajectory in Ethiopia. But the region was still vulnerable to external inflationary shocks, such as the disruption to trade caused by the conflict in the Strait of Hormuz.
Despite economic gains, the report reveals uneven progress toward the Sustainable Development Goals (SDGs) and underscores profound social development challenges. Currently, only 7 out of 234 SDG indicators are on track in Eastern Africa. Furthermore, because the region receives over 50 percent of all Official Development Assistance (ODA) directed to Africa, it remains highly vulnerable to global aid cutbacks, which is straining local health, education, and social protection systems.
The webinar featured comments by Mr. Abbi Kedir, Acting Executive Director of the African Economic Research Consortium, who commended the report as one of the best regional reports he had seen, citing its credible and timely data, as well as its rigorous analytical approach.
Kedir highlighted that growth must translate into tangible improvements in people's lives through stronger job creation, food security, lower cost-of-living pressures and expanded social systems.
Participants raised a number of observations about the regional growth trajectory, including a discussion around whether the heavy dependence on the services sector was positive for long-term growth and development.
The full report, Eastern Africa's Balancing Act: High Growth, Tight Budgets and Rising Uncertainty, can be downloaded here:
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