Updated: Feb 7
Do not ignore Africa
“Ignoring Africa is like ignoring the future of where the world’s going,” according to Ajay Banga, the head of the World Bank in a recent interview with the Financial Times. https://www.ft.com/content/95eaac18-bd50-4af7-ac51-a2a2b3dafbdb
In one particular sense that is certainly true. According to the United Nations’ latest population projections, the population of the African Union will increase by a billion people (from 1.5 billion to 2.5 billion) by 2050. Africa will have a demographic dividend in that sense – more people – and also because it will have a relatively young population.
Permanent crisis
But Africa seems to be locked in a permanent crisis. Nicolas van de Walle’s 2001 book African Economies and the Politics of Permanent Crisis set out the reasons for that. There is good YouTube video of him discussing the book https://tinyurl.com/3e4bssfb and there was a great article in The Economist about it https://tinyurl.com/mucvzkd2
According to de Walle, dynamics internal to African state structures largely explain this failure to overcome economic difficulties. Prevarication and manipulation of the reform process, by governments which do not really believe that reform will be effective, which often oppose reforms because they would undercut the patronage and rent-seeking practices which support political authority, and which lack the administrative and technical capacity to implement much reform are the root causes.
Some think many have learnt nothing at all from the experiences of the past. Dependence on aid is much lower. Aid was 15% of GDP pre-1999 and now is more like 5%. Ideologically, the continent is in a different place. In the 1980s and 1990s many were opposed to FDI; now it is welcomed.
The region still has structural difficulties – its closed markets; the difficulty of breaking into global export-led manufacturing; and, still, problems with governance. But this is a period of enormous potential.