Africa's Economy: High Prospects of Boom with Caused Failures

Africa today:

$1.6 trillion – Africa’s collective GDP in 2008, roughly that of Brazil or Russia
$860 billion – Africa’s combined consumer spending in 2008
$316 million – the amount of new mobile subscribers signed up in Africa since the year 2000
60 percent –  Africa’s share of the world’s total amount of uncultivated land
52 the number of African cities with more than 1 million people living urbanized
20 the number of African companies with revenues in excess of $3 billion

Africa tomorrow:

$2.6 trillion – Africa’s collective GDP in 2020
$1.4 trillion – Africa’s consumer spending in 2020
1.1 billion the number of Africans of working age in 2040
128 million the number of African households with discretionary income in 2020
50 percent –  the portion of Africans living in cities by 2030

Africa is a destination for cheap and less costly labour which makes the prospects of booming economic activities high. The coming of more Foreign Direct Investments will be gingered by this. It remains a hot spot for investors.

It is worthy of note that Africa’s acceleration resulted from more than just a resource boom. Their have been various attempts by governments to terminate political unrest, implement enhanced macroeconomic policies creating better business climates but all these are again truncated with leadership greed.

Africa is a continent of commodities. Natural resources accounted for 24 percent of GDP from 2000 to 2008. The rest came stemmed from other sectors i.e. retail, wholesale, transportation, telecommunications and manufacturing. This is also a positive sign of economic growth since the 80’s.

Additional efforts to privatise state-owned enterprises, reducing trade barriers, cutting corporate taxes where applicable and improved regulatory systems, have stimulated economic blood flow. The headache is this angle is the lack of adequate regulations to properly guide the workings of the private sectors, hence, abuse and 'slavery' exist in most industries especially that of the Chinese, Indians and other Asian countries.

In the year 2000 foreign direct investment in Africa stood at $9 billion. Today FDI stands at in excess of $100 billion just from China alone.

Although Africa has all these resources its future is critically dependent on other developments and measures that need to be resuscitated to peak performance in order to competitively compete holistically.

Such sectors are education from kindergarten levels. Infrastructure for education needs dramatic attention, inclusive of modern technology that can be accessed on the Chinese market. Africa as at now has not astutely taken on the sector which is a critical pivot for development.

Upgrading and improving the syllabus for teacher education programmes. Special attention must be given to the food security in rural areas where children can also access upgraded medical facilities impacting on the high mortality rates.

No greater impact will occur than by 2020 where the forecast for urbanisation will be devastating for sustainable growth. Today 40 percent of Africa’s population live in her cities. By 2020 it is projected that more than half of African households will have discretionary spending power, straining urbanisation and impacting on the pollution levels for which Africa will also have to comply.

Impacting on green solutions is the lack of refuse and waste recycling throughout Africa. The one in Nigeria in Lagos is at best a concept in its nurturing state. These industries are neglected across the continent. Metals, plastics and alternative manufacturing from recycled metals and plastics are lagging industries throughout African that enjoy high employment.

The four most advanced economies in Africa – Egypt, Morocco, South Africa and Tunisia currently enjoy advanced manufacturing and services industries. These countries are also classified as diverse economies and will face some challenges related higher labour costs and volatility in the export markets.

Africa has been exercising her economic policies and stimulating the heart of sovereign industries in order to achieve continental growth. So far we have every right to believe that we are on course for recovery and maybe a renaissance in the making.

Now more than ever, inter-continental remedies are needed to achieve stability, improve human rights, promote economic democracy outside of political ambitions and re-establish Africa as a continent proud of her heritage. To get to that desired destination, African leaders need to end avarice and imbibe dynamic patriotism wholly.

Statistics Courtesy: Ventures Africa.