Transforming Africa's Expansion into a Generational Blessing

The World Bank released the latest Africa’s Pulse Volume 7 on April 15, 2013. It reports that Africa has maintained impressive growth momentum as well as having made progress towards the Millennium Development Goals. Another highlight of the report includes a graph on the fastest growing economies that depict a number of African countries outperforming China and India in terms of economic growth.

 

 

As Africa's economy continues to grow, questions arise over how to make that growth sustainable.

The World Bank released the latest Africa’s Pulse Volume 7 on April 15, 2013. It reports that Africa has maintained impressive growth momentum as well as having made progress towards the Millennium Development Goals. Another highlight of the report includes a graph on the fastest growing economies that depict a number of African countries outperforming China and India in terms of economic growth.

This growth is making a dent in poverty on the continent but not as deep as we would like to see. The growth phenomenon is not new. The IMF World Economic Outlook 2012 declared that: “Economic activity in sub-Saharan Africa (SSA) has expanded by more than 5 percent in each of the past three years — continuing a decade-long run of strong performance that was only briefly interrupted by the global downturn…”. It was reported by Forbes magazine in 2012 that Africa is rising fast. The Economist, on March 2, 2013, featured an article written by Oliver August titled: "A Hopeful Continent". The author stated that: “African lives have already greatly improved over the past decade…The next ten years will be even better”. Notably, there are a host of other publications singing the same tune.

Reasons for the Good Fortune

What are the reasons for the solid expansion taking place across Africa? One reason is the replacement of the Organization of African Unity (OAU) with the African Union (AU). Since the AU took over, governance has significantly improved. Democratic ideals have been prioritized and  coup d’états have been on the decline. There has also been a gradual move towards transparency of many resource transactions as reflected by the number of African countries that have signed up to the Extractive Industries Transparency Initiative standard (EITI), which ensures transparency of payments for natural resources. Notably, the emergence of China as a global economic powerhouse and its interest in doing business with Africa, exchanging its goods and services for Africa’s natural resources, has had a significant impact on growth within the continent. The current leadership of the continent, while not perfect, has also played a role in the current state of affairs by implementing relatively sound policies.

A Better Life on the Horizon?

The issue, however is, will the current growth translate into a better life for ordinary Africans? The answer to this question remains in limbo. Whether daily life improves is largely dependent on the nature of public polices implemented in this time of expansion. This will dictate whether the current wealth can be translated into dividends for posterity. One probable key is diversification. As the old saying goes, no one should put all their eggs in one basket. The same is true for Africa's economy.

A Lesson From Dubai

A little over 50 years ago, Dubai was described as a poor fishing settlement. Fast-forward 50 years later, it is an ultra modern city with a much higher human development index than it once had. What was the key to this transformation? Some analysts would cite the oil boom that Dubai rode to fame and wealth; but I beg to differ.

This definitely played a role but the main key was leadership. As a Stephen Adei, an amazing transformational servant leader himself, says: “Leadership is cause; everything else is effect”. This is certainly true in the case of Dubai. Many countries have ridden resource booms but have not emerged as Dubai did. What was the difference? Simply put, it was leadership. Dubai’s leadership realized that the oil would someday run out and they came up with a strategy that would enable sustained growth and prosperity when that time dawned. The simple but brilliant plan was to convert the oil wealth into another form of man-made resource that would not become depleted if looked after well. They used the oil wealth to convert a fishing settlement into a world-class tourist destination — one that attracts large sums of foreign investments. This took keen foresight in policy planning.

The End of the Matter

It is said that a failure to plan is a plan to fail.

Africa's leaders need to plan with a view for the future. If Dubai transformed itself in 50 years, so can many African countries. It is up to leaders in sub-Saharan Africa to analyze the counsel proffered from various quarters of the globe; select the most advantageous and adaptable to its people and context; and come up with, long-termed best policy options that can help to transform today’s wealth into tomorrow’s cash cow. This is a weighty undertaking but doable as the folks from Dubai have taught the world.



This article was originally published on the Fair Observer website. The author, Solomon Appiah, is a policy enthusiast with a heart for the development of Africa. A DAAD Public Policy and Good Governance fellow, he is a native of Ghana. 

For more information: 

Blog: www.solomonappiah.wordpress.com

Follow on Twitter: @SolomonAppiah5 

 

Infographic taken from the Africa Progress Panel website.

 

 

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