Thursday, May 27, 2010

Hope for Africa Despite the Gloom Bringers

Back in the 1990s, there were Africa policy people who were labeled “Afro-pessimists” because of their unrelentingly gloomy outlook on Africa’s future. Given the continuing conflicts, denial of rights, manipulation of elections and other negative trends, one could look at the glass as half empty and getting lower. However, you would have to ignore strong positive trends that cannot be easily cast aside.

Even though the global economic crisis crippled economies across the planet and even caused a dip in commodity prices and timidity in investment that slowed African economic growth, the continent has survived with bright prospects moving forward. According to the African Economic Outlook issued by the African Development Bank Group, the average annual gross domestic product growth for 2010-11 is estimated to be 4.5% this year and 5.2% in 2011. That’s up from 2.5% last year.

East Africa is seen as leading the way with 6% growth, while North and West Africa are each expected to grow at 5%, while Central Africa is expected to grow at 4% and Southern Africa at just under 4% because it was the hardest hit region. The African agriculture sector generally experienced good harvests due to favorable weather, but sectors such as mining and manufacturing were hard hit by the drop in commodity prices and aren’t expected to rebound quickly.

Dr. Ngozi Okonjo-Iweala, Managing Director of the world Bank, recently said that sub-Saharan Africa grew faster that both Brazil and India during the first decade of this century and will continue to grow faster than Brazil during the first half of the second decade of the 21st century. Given the need for fiscal retrenchment in the industrial countries of the world, African countries can benefit from the rebalancing of economies and serve as a new source of global demand.

In Liberia, a nation devastated by a long, brutal civil war and a subsequent uprising that chased into exile then-President Charles Taylor, current President Ellen Johnson-Sirleaf recently said her country’s private sector is being stimulated to create jobs to absorb the many young Liberians who are without work, and her government is introducing literacy programs to enable those young people to develop skills to fit the evolving marketplace. Confidence in Liberia, she said, has risen to the point that it is attracting foreign investment. In fact, President Sirleaf predicts that in 10 years her country will be self-sufficient and no longer in need of international assistance.

In the face of continuing attacks from the Lord’s Resistance Army and other rebel groups, Uganda has had to double its power output in the last five years because of the country’s booming economic growth. New power plants have been added in Tororo, Namanve and Mutundwe in Kampala that add to the existing hydroelectric power generation. Moreover, Uganda is pursuing renewable energy sources, such as the production of electricity from sugar cane waste.

Stories of blossoming African companies abound across the continent. Even formerly strife-ridden countries like Angola are seeing an economic resurgence due to a foreign-trained young entrepreneurial class. Madagascar had been a rising economic star until the recent political wrangling led to the overthrow of successive governments. It is hoped that when the latest political upheaval is resolved, the country can resume its upward economic trajectory.

Several African countries are usually listed among the world’s frontier emerging markets. They include Botswana, Cape Verde, Ghana, Kenya, Mauritius, Mozambique, Namibia, Nigeria, Seychelles, South Africa, Tanzania, Uganda and Zambia.
Certainly, there is plenty to criticize if you’re looking for reasons to do so, but Africa’s countries have mostly proven to be more resilient than some had supposed.

Lying ahead is a demographic surge that has already seen Africa’s population grow from 672 million in the year 2000 to 820 million by 2008. Africa is soon expected to join the one billion population club now inhabited only by China and India. Of Africa’s enlarged population, more than 43% is under 14 years of age, making Africa the world’s youngest continent.

Africa has faced wars, tyranny, corruption, short-sighted leadership, pestilence, famine, droughts, floods and any manner of other challenges and continues to rise in spite of them. Not all African countries are succeeding nor will they all succeed in the years ahead. Still, those who do will experience the kind of economic growth and wealth creation that transforms societies.

On the floor of the Senate of Imperial Rome centuries ago, it was once asked: “Can anything good come from Africa?” The answer was yes on that day so long ago, and it is still yes today.

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