It’s hard to put aside two thoughts when thinking about Africa:
The first is to think that Africa is a continent forever sentenced to poverty, illness, starvation
and tragedy... a lot of tragedy.
Further, Africa is often thought of as a somewhat compact territory where everything is connected.
To Western eyes, Africa can look more like a country than a continent.
With many failing to realize the colossal size of the continent.
Africa is as big as Europe, the U.S., India, China and Argentina combined.
So you can now imagine the diversity that this huge territory must contain.
In 2010, the Economist referred to Africa as the continent without hope.
But, as can often happen, things changed rapidly.
Since the start of the 21st Century, Africa has experienced a significant boost, especially
the poorest countries on the continent.
With the exception of South Africa, the countries of Sub-Saharan Africa achieved annual growth
rates of 6.2%.
By comparison, that is twice the growth rate seen in Latin America during the same period
of time.
In 2015, 5 of the 10 economies that grew the most were in Africa:
The Ivory Coast, Ethiopia, Tanzania, Rwanda and the Democratic Republic of Congo.
Their growth exceeded 7%.
Although the growth figures were a bit smaller, the situation remained similar in the year
2016.
And all this growth has lead to some significant social consequences.
Let’s have a look at some of these: Life expectancy has increased significantly
over the last 8 years; child mortality figures and those dying from starvation has been cut
in half.
To sum up, extreme poverty used to affect 58% of the population in 1999, and now it
has decreased to just 35%.
It is still true that more than 420 million people are still suffering extreme poverty,
which is tragic but, fortunately, the future’s looking brighter than ever.
Another thing is also certain: Africa is going to have a major global role over the coming
decades.
Africa is being urbanized quickly, which allows for both provision of public services and
economies of scale.
In the near future, we are going to find many of the world’s biggest cities on this continent.
Who knows?
Lagos, Nairobi or Accra might become the new Shanghai in a few decades.
For example, the tallest skyscraper in Africa, the Hass Towers, are being built in Nairobi.
In Accra, Ghana's capital city, 6 malls have been built in only 6 years.
And while that might not seem like that many to you, before those 6 new ones were built,
there was only one in the entire city.
Foreign investment has grown strongly in the last few years and almost half of these investments
operate in sectors which have nothing to do with Africa's natural resources.
This is important: many of the economies in Africa are trying to develop industries outside
raw materials so they start to depend less on natural resources.
They economies are known as “African lions” THE AFRICAN LIONS
Kenya, Uganda, Tanzania, Mozambique, Zambia...
These are the African Lions.
The countries in Africa that are developing the fastest.
We will discuss each of them in detail in the future, but today, we will focus on just
three: RWANDA
This is a small country with a population of only 12 million and without any coastline.
It is still a poor country, but it has registered an almost 9% annual growth since the year
2001 and, importantly, this country has no oil or other important natural resources.
So, how did they do it?
Well, this has mainly been through supporting business creation.
This way Rwanda is the second easiest country to do business in in sub-Saharan Africa, according
to the World Bank “Doing Business” report.
Is this a coincidence?
I don’t think so...
Thanks to all this, nearly all children have primary education and 98% of its people have
already have access to health care.
As a consequence, child mortality has been reduced by 60% and AIDS and malaria have also
seen significant reductions.
Further, Rwanda´s president: Paul Kagame, claims to be a disciple of Lee Kuan Yew, the
legendary leader of Singapore, whom we will discuss in an upcoming episode - don’t forget
to subscribe so you won’t miss that or any of our other videos!
ETHIOPIA This is a much larger country with a population
of nearly 100 million people.
In Ethiopia around 20 million people still have nutritional problems.
And that is not the only problem they have.
The government has also become more authoritarian recently.
However, things are changing fast and today, Ethiopia's capital city: Addis Ababa is always
pursuing significant construction projects.
In fact, about a year ago, Addis Ababa opened the first modern tram system in all of Sub-Saharan
Africa.
And they deserve it.
Ethiopia is the country which has grown the most in the last 10 years, its economy multiplied
by 5 in this period of time and its GDP growth has been over the 10% every year.
So now you might ask: “How did they do it?”
Well, they were simply trying to be more attractive to investors than their neighbouring countries.
In to do so, the country has established two main priorities: 1.
Achieve stable macroeconomics 2.
Establish attractive taxation.
For example, imports of capital assets such as technological equipment (machinery etc)
do not have to pay any import levy.
Further companies don’t have to pay any tax during their first years.
Pretty nice, right?!
BOTSWANA We couldn’t make this video without including
Botswana - a country which recently celebrated in 2016 the 50th anniversary of its independance.
Botswana has been the greatest economic success story in Africa.
In fact, it is even one of the most successful worldwide.
At the time of Botswana’s independence in the year 1966, it was one of the poorest countries
in the planet.
On top of that, the country has suffered severe droughts and has suffered from the second
largest AIDS epidemic in the world.
In spite of all these obstacles, the country has experienced development so significant
that its GDP in purchasing power parity is equivalent to countries such as, Colombia,
Brazil or Thailand!
(That is, obviously, considering the different levels in prices among these countries).
Here, the key to success can be found in the strength of its national institutions, their
healthy public finances and, above all, the country’s legal certainty.
In fact, in the last CPI (Corruption Perception Index) Botswana was in 31st position.
A better position than countries like Spain, Israel, or Taiwan.
But, now, how about some more surprising facts about Africa?
You should know that this continent is already home to more than 400 companies with a turnover
of more than a billion dollars a year.
It really seems as if the end of Africa being a totally poor continent is coming to an end.
Furthermore, we can also find “Nollywood,” the second largest film industry (in terms
of films produced) in the world.
Only 2,500 films less than Bollywood!
Further, in Nigeria alone, this film industry employs around a million workers.
And one final surprise: Africa is the World leader in on-line banking and mobile phone
payments.
Yep, you probably weren’t expecting to hear that, but it’s totally true.
Today many farmers share information through SMS and, in the streets of Rwanda, it is popular
to use “Safemotos”, which is like a Rwandan version of Uber with a small difference: They
use motorcycles instead of cars since there are very few cars available.
The thing is that Africa is changing very fast, but the truth is there are still many
challenges and difficulties ahead.
For example: consolidating the rule of law, reducing poverty, and improving their infrastructure.
And, of course, they need to put an end once and for all to those terrible dictatorships
in countries like Angola, Eritrea or Equatorial Guinea.
However, everything does seem to indicated that the future for Africa is brighter than
it has ever been.
So, I hope you found this video interesting.
We’d love to know what you think?
Do you think Africa is going to become a major player in the coming decades?
Let us know in the comments below.
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And I’ll see you next time!