Africa as the future economic growth engine of the world

16Mar 2022
The Guardian
Africa as the future economic growth engine of the world

The economy of Africa consists of the trade, industry, agriculture, and human resources of the continent. As of 2012, approximately 1.07 billion people  were living in 54 different countries in Africa. Africa is a resource-rich continent. Recent growth has been due to growth in sales-

-in commodities, services, and manufacturing. Sub-Saharan Africa, in particular, is expected to reach a GDP of $29 trillion by 2050.  

In March 2013, Africa was identified as the world's poorest inhabited continent: Africa's entire combined GDP is barely a third of the United States' GDP; however, the World Bank expects that most African countries will reach "middle income" status (defined as at least US$1,000 per person a year) by 2025 if current growth rates continue. In 2013, Africa was the world’s fastest-growing continent at 5.6 per cent a year, and GDP is expected to rise by an average of over 6 per cent a year between 2013 and 2023. In 2017, the African Development Bank reported Africa to be the world’s second-fastest growing economy, and estimates that average growth will rebound to 3.4 per cent in 2017, while growth is expected to increase by 4.3 per cent in 2018.  

Growth has been present throughout the continent, with over one-third of sub-Saharan Africa countries posting 6 per cent or higher growth rates, and another 40 per cent growing between 4 per cent to 6 per cent per year. Several international business observers have also named Africa as the future economic growth engine of the world.

Africa's economy was diverse, driven by extensive trade routes that developed between cities and kingdoms. Some trade routes were overland; some involved navigating rivers, still others developed around port cities. Large African empires became wealthy due to their trade networks, for example Ancient Egypt, Nubia, Mali, Ashanti, and the Oyo Empire.

The dawn of the African economic boom (which is in place since the 2000s) has been compared to the Chinese economic boom that had emerged in Asia since late 1970's.[12] In 2013, Africa was home to seven of the world's fastest-growing economies.  

The United Nations predicts Africa’s economic growth will reach 3.5 in 2018 and 3.7 per cent in 2019.  As of 2007, growth in Africa had surpassed that of East Asia. Data suggest parts of the continent are now experiencing fast growth, thanks to their resources and increasing political stability and 'has steadily increased levels of peacefulness since 2007'. The World Bank reports the economy of Sub-Saharan African countries grew at rates that match or surpass global rates. According to the United Nations Department of Economic and Social Affairs, the improvement in the region’s aggregate growth is largely attributable to a recovery in Egypt, Nigeria and South Africa, three of Africa’s largest economies.  

In the same vein, African countries can turnaround their economies for the better if they invest heavily in the continent’s young population, American philanthropists Bill and Melinda Gates have advised in their 2019 annual letter.

When economists describe the conditions under which countries prosper, the couple writes, one of the factors they stress is human capital, which is another way of saying that the future depends on young people’s access to high-quality health and education services.

“Health and education are the twin engines of economic growth. If sub-Saharan Africa commits to investing in its young people, the region could double its share of the global labour force by 2050, unlocking a better life for hundreds of millions of people,” the letter reads.

Girls’ education, especially, is among the most powerful forces on the planet, they note, adding that educated girls are normally healthier wealthier.

 If all girls received 12 years of high-quality education, women’s lifetime earnings would increase by as much as USD30 trillion, which is bigger than the entire United States economy, the letter reads.

Why did the billionaire couple choose to highlight the issue of African youth in this year’s letter? It’s because the global median age is on the rise. In every part of the world, people are living longer. As more children survive to adulthood, women are having fewer children than ever before.

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