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It is indeed true that Africa’s economic pulse has quickened, infusing the continent with a new commercial vibrancy. According to the World Bank, Real GDP rose 4.9% per year from 2010 through 2016, more than twice its pace in the 1980s and 90s. Telecom, banking, and retail are flourishing. Construction is booming. Foreign investment is surging. Africa is among the world’s most rapidly growing economic regions. This acceleration is a sign of hard-earned progress and promise. If this is so, what is to be done to propel Africa to much higher levels of development?
For this effect, the immediate task is to sustain and increase bold investments in social and economic infrastructure, i.e. education and training, healthcare, roads, ports, telecommunications, research and innovation, railways, regulatory institutions etc. These will improve Africa’s competitiveness, drive down the costs of doing business, spur small enterprise development and improve the employability of the young majority population.
A stronger higher education, research and innovation sector has an important role to play in this regard. It must provide breakthroughs to many of the social and economic challenges Africa faces today. Africa should also acknowledge that its performance in the area of agriculture is discomforting given that it accounts for 60% of the world’s uncultivated but arable land. This partly explains the stubborn challenge of food insecurity and mediocre contribution of the sector toward the GDP. A major part of China, India and Brazil’s growth story has been the result of their capacity to mobilise and apply capital to stimulate agriculture and related industries for both internal needs and export markets.
As is already the case in Kenya and in South Africa, vistas of growth in the tourism markets are endless. This too requires security, network infrastructure and service excellence. Like Kenya, South Africa is sustaining its peace-building, conflict resolution and post-conflict reconstruction efforts. However, both countries continue to have the challenge of being prime destinations for political and economic refugees.
Therefore, supporting stabilization efforts in countries such as Somalia, South Sudan and the Democratic Republic of Congo is in essence an investment in growth and development since no country or region can grow sustainably in the context of violent conflict and wars, civil as well as cross-border. Wars squander resources meant for human capital development and economic activity. Africa needs to coordinate particularly, infrastructure development programmes and projects.
South Africa and Kenya hold an important role within the Eeast African Community (EAC), COMESA and SADC, just as Nigeria and Algeria are leading growth in West and North Africa respectively. Therefore, their quest for achieving greater regional integration places the responsibility on their shoulders to forge closer coordination and partnerships drawing on each other’s strengths. This is even more urgent in the context of Africa’s efforts to build a Tripartite Free Trade Area with a roadmap agreed to at the Sandton Summit in 2011. Necessarily, they should drive this free trade area initiative and the ultimate achievement of the African Union’s envisioned African Economic Community which is designed to promote economic, social and cultural development as well as African economic integration.
The World Bank as well as the IMF, time and again, emphasised the importance of the global interconnectedness of Africa’s economies, which will largely be shaped by economic partnerships forged with the global community and especially with the emerging powers from the global South. The demographic dividend i.e. youthfulness of Africa as compared to OECD and Asian countries, the internal social dynamics like human capital, urbanisation, and the rise of middle class consumers, will all contribute to this anticipated great leap forward. The sub-Saharan region has already made big strides below the radar. It now stands to become the developing world’s next great success story. This is demonstrated by statistics showing that in 2015, “the rate of return on foreign investment is higher in Africa than in any other developing region”.
Consequently, projections are that by 2020, Africa’s collective GDP, consumer spending, and households with discretionary income will have skyrocketed. For its part, the 2015 Global Economic Prospects report makes the following conclusions about scenarios for growth in Africa South of the Sahara. Overall, the region is projected to grow at its pre-crisis average rate of 5 per cent over the 2013-2015 period.
Excluding South Africa, the region’s growth will average 6% over the 2013-15 period. Aggregate foreign direct investment inflows increased by 5.5 percent in 2015. Consumer spending accounting for over 60 percent of GDP in the region and is, therefore, an important determinant of overall growth. Consumer demand has grown relatively rapidly in recent years, supported by solid real incomes growth. Indeed, over the past decade real per capita incomes rose by an average of 2.3 percent annually. As a result, as of 2012 some 21 sub-Saharan African countries (almost half) are classified as middle income economies compared to only nine a decade ago. Export growth in sub-Saharan Africa was relatively robust in 2015. Export volumes in the region increased by 4.5 percent between January and July 2016, versus a global average of 3.6 percent during that period.
All this points to one conclusion. Africa is emerging and making strides towards leveraging the post independence dividend. Whilst it is now accepted that the dim picture that characterised Africa shortly after independence to the turn of the century has been replaced with optimism of an Africa determined to turn the corner and claim its place in history, we should warn against complacency.
The sustainability of all attempts to build an Africa that can claim its place and catch up with the rise and speed of development of other emerging powers will largely be informed by the sound institutions necessary to provide support to commerce-driven development, under free, just and democratic political arrangements. History enjoins Africa to make the aspirations of its people a reality. Instead of narrow national interests, Africa should use its economic and geopolitical position to build a continent its people want and deserve to live in.
As Pixley ka Isaka Seme, one of the great sons of Africa, said in 1906: “The African already recognizes his anomalous position and desires a change. The brighter day is rising upon Africa. Already I seem to see her chains dissolved, her desert plains red with harvest, her Abyssinia and her Zululand the seats of science and religion, reflecting the glory of the rising sun from the spires of their churches and universities. Her Congo and her Gambia whitened with commerce, her crowded cities sending forth the hum of business, and all her sons employed in advancing the victories of peace – greater and more abiding than the spoils of war”. Yes, the regeneration of Africa belongs to this new and powerful period.