Africa can still be on the up

Africa can still be on the up

Jonathan Power

May 26, 2020

Africa is suffering a double whammy after many years of success. The Coronavirus, while not taking down great numbers of people like in Europe, Asia and the Americas, has had a severe impact by curbing its exports in the face of the formers’ severe economic depression.

For example, flowers grown in Kenya and Ethiopia have been particularly hit. Kenya’s flower industry employs up to 70,000 people. Ethiopia’s horticulture provides 180,000 jobs.

Kenya’s overnight exports of cut flowers to Europe have been worth almost 770,000 US dollars a year, up from 134 million in 2000. Now sales are on their way to rock-bottom.

At the same time parts of East Africa have been hit by plagues of locusts, the likes of which have not been seen for over 70 years. They eat everything that comes their way. For the first time in a decade in Africa, many people are going hungry in countries that had had no trouble feeding all.

Young, newly unemployed, people in the cities have been pushed to return home to their family villages and take up the hoe.

Many are trying to migrate into Europe, although it is not in the numbers that the over-reacting media suggest. Only 2.5% of Africans live abroad compared with the global average of migrants living abroad, 3.5%.

Even so, there are many reasons for hope. Before these calamities struck Africa was beginning to bounce. Africa had six of the world’s ten fastest-growing economies.

Over the past decade, half of sub-Saharan Africa has grown at 5-6% a year. Some, such as Ethiopia, have seen a growth of 10% a year, the highest in the world.

There is no good reason why Africa should not return to that benign state once the northern part of the world gets on top of the Coronavirus. A silver lining is that the Coronavirus has been well contained in Africa.

This is partly because Africa had time to see it coming and got itself well organized to test and trace. Second, densely populated West Africa had experienced Ebola and had learned from that. When Ebola raged, Nigeria, Africa’s most populated country, managed to keep deaths down to seven. It was well organized – in a way that shames Europe’s and North America’s response today.

Africa’s eyes are still set on its future. In August last year, African leaders announced the creation of a continent-wide free trade area. If successful over the next decade it will bring together 1.3 billion people in a 3.4 billion US dollar economic zone.

Already the “young continent”, with 60% of its population below the age of 25, has the highest rate of private entrepreneurship in the world. 22% of working age-Africans have launched new businesses. This compares with 13% in Asia and 19% in Latin America. More than 400 African companies already take in at least 1 billion dollars in annual revenue.

BBC World runs a weekly program on African business. New viewers will be struck by how much the African economy has going for it.

Mobile phone ownership has grown at a faster rate than anywhere else. 20% are smartphones enabling users to leapfrog into the modern age.

In some parts of Africa, one can visit villages buried in the countryside which are using smartphones to transfer money and to get advice from doctors and nurses living in the big city. This is a fast-growing phenomenon.

The Chinese are making great inroads into Africa – although not as much as is often reported. It makes about 20% of total outside investment. It has been estimated that the Chinese have created 10,000 businesses in Africa.

India, Turkey, the UK and the European Union invest more. Regrettably, US investment, trade and aid have fallen.  The EU has announced that it will give €40 billion in grants from 2021 to 2027, building on Germany’s “Marshall Plan for Africa”, launched in 2017.

Political interest and diplomacy are responding to this economic advance. According to a study made by the University of Denver more than 320 embassies and consulates were opened in Africa between 2010 and 2016. Turkey alone opened 26.

The Turkish president Recep Tayyip Erdogan has paid more than 30 visits to the continent. Emmanuel Macron of France has made 10 visits; Narendra Modi of India 8 times. But Barack Obama only visited three times during his presidency despite having a Kenyan father. Donald Trump has not visited once.

Turkish Airlines now flies to 50 African destinations, nearly every country. Ethiopian Airlines, Africa’s premier airline, which has a low accident rate, comparable to European airlines, has rapidly added to its worldwide destinations. (Sometimes its planes are staffed by all-female Ethiopian crews.)

Over the last decade, Africa has seen a return to democracy, (admittedly some countries have gone backwards). The democracies have higher rates of national income growth.

Wars have decreased.

Even the Congo after decades of conflict has gone almost quiet. Increasingly, countries have sounder economic policies- although it is tragic that Nigeria is not one of them after the sensible and effective years of President Olusegun Obasanjo when all looked possible. Three presidents later, the present-day economic and financial policy is a mess.

Primary education has grown fast. Girls are being educated at a steady pace. This should bring down the birth rate, forestalling those prophets of doom who predict an over-fast population growth that swamps economies.

A former president of South Africa, Thabo Mbeki, spoke of the present being “the African century”. There is no good reason why it shouldn’t be, despite the present-day double whammy.

Copyright: Jonathan Power

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One Response to "Africa can still be on the up"

  1. F Jahanpour   May 28, 2020 at 12:40 pm

    It’s good to have some positive news for a change. Hope all predictions will prove correct and this long neglected continent, but youthful and rich in people and resources, will find its rightful place in the international community.

    Reply

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