Africa growing faster, but who benefits?
A look at some of the continental issues raised at the World Economic Forum on Africa, held in Durban
Six out of the 10 fastest growing economies in the world this year are African. This makes Africa the fastest growing region in the world after Asia, despite the sluggish growth and economic misfortunes experienced across the globe over the past nine years.
The World Economic Forum (WEF) also predicts that by 2030, one in five people will be African. Combine the continent's soaring population with technology, improvements in infrastructure, health and education, and Africa could be the next century's economic growth powerhouse.
The International Monetary Fund (IMF) growth index predicts that Ghana's gross domestic product (GDP) growth rate will be around 13.73 per cent this year, followed by Côte d'Ivoire at 7.98. The IMF predicts that, this year, Ethiopia's GDP will grow by around 7.50 per cent, Tanzania's by 7.24 per cent and Djibouti's by 7 per cent.
At face value, all this paints a picture of a growing and prospering continent, but some observers disagree. Many of the African countries that are seen to be progressing economically are still among the most underdeveloped.
In May, the continent celebrated its unity, marking the founding of the Organisation of African Unity on 25 May 1963. But, for many, there is little to celebrate. Political freedom means nothing without economic growth, some argue.
Poverty and inequality is still rife. With the number of working-age people expected to grow to 450 million
over the next two decades, there just is not enough innovation and development to create much needed jobs. Entrepreneurship is also slow to take off. Observers say the result could be a worsening crisis of youth unemployment.
What is the problem? Why are African countries finding it so hard to see the fruits of their economic growth channelled to development and prosperity for their citizens? Why does poverty and underdevelopment still persist, when the region is said to be the fastest growing?
These are some of the questions that dominated talks at the World Economic Forum on Africa, held in Durban from 3 to 5 May.
Over the years some people have blamed the West and international institutions such as the IMF and World Bank for Africa's problems.
But, in Durban, the more than 1 000 business leaders from 100 countries present were determined to stop the blame game. They wanted to find solutions.The values of leadership and inclusive growth in Africa dominated the meeting.
“The World Economic Forum
Inclusive Development Index 2017 lists Cameroon, Chad, Ghana, Kenya, Mali, Namibia, Senegal, Tanzania, Uganda and Zimbabwe, as the continent's 10 inclusive
Inclusivity is elusive
Everybody agreed Africa was growing. However, the growth was not inclusive, judging by the gap between rich and poor. It was the main theme of the meeting in Durban. How can Africa achieve economic growth that doesn't leave the majority of its people behind?
Something needs to be done to ensure inclusive growth and this requires effective leadership of the economy, which is something many African countries are seen to be lacking.
The World Economic Forum Inclusive Development
Index 2017 lists Cameroon, Chad, Ghana, Kenya, Mali, Namibia, Senegal, Tanzania, Uganda and Zimbabwe as the continent's 10 inclusive economies.
What does this say about the rest of the countries in Africa? Are their economies not inclusive? Perhaps this question can only be answered by those countries.
South Africa's President Jacob Zuma seems to be aware of the problem, if his speech at the meeting was anything to go by.
“As leaders, we have not addressed adequately how we are going to close the gap between the rich and poor in the world and achieve meaningful, inclusive growth,” he said, speaking at the opening ceremony.
He also said that more needed to be done globally to combat “economic crimes” such as money-laundering and profit-shifting. Illicit financial flows out of Africa that amount to billions of US dollars have been viewed to be among the critical issues that slow the continent's progress.
The theme for this year's WEF on Africa meeting centred on inclusive growth and responsive leadership. Inclusive growth has also been the buzz phrase in South Africa, following government's recent pronouncements on radical economic transformation.
Most populations remain poor
Those who attended the meeting in Durban agree that the majority of the world's population remains poor and has been side-lined from the real economic activity. For
its part, South Africa wants to change this picture of noninclusive growth, Minister of Finance Malusi Gigaba told the meeting.
The minister went to great lengths to outline what South African government leaders mean when they speak of the “radical transformation” of Africa's biggest economy.
“We have not paid enough attention to developing a productive economy in the township and rural areas,” Minister Gigaba told guests in one of the dialogue sessions in Durban.
“The special problems of the apartheid system have not been addressed sufficiently,” said Minister Gigaba.
It should therefore be understood why people were impatient for speedy change, he said.
But to blame Africa's problems just on outsiders is disingenuous, argued other panellists at the dialogue sessions.
Prominent South African politician Lindiwe Mazibuko called for a new generation of leaders. “Africa has a leadership vacuum,” Mazibuko said, adding that the current crop of Africa's leaders has failed to deliver.
“We need a different line of understanding of what leadership in an African society is, beyond politics and business, into the non-profit, into civil society, into churches, schools, communities. We need to redefine leadership,” Mazibuko said.
Professor Klaus Schwab, founder and executive chairman of WEF, echoed this: “We need leadership that respects human dignity and diversity. We need a value-based leadership that serves the community.”
Minister Gigaba's solution was intra Africa trade.
“African countries need to identify new markets to focus more on trading with one another, identify markets in emerging economies and trade with
2 billion: those countries that are still open to trade.”
Although there were opportunities for African countries globally, these often came with risks. “However, I think on the overall, we need to take a positive outlook and focus on what we need to do in order to grow our economies to sustain the growth over the medium to long term,” Minister Gigaba said.
Lack of innovation was also cited as one of the things that were slowing Africa's progress. Available statistics at the meeting revealed that Africa has fewer than 100 scientists per million people, which is a paltry eighth of what it needs.