Euphoria abounds in much of Africa nowadays, and rightly so. Seven of the world's ten fastest-growing countries are there. Recognising the potential and importance of the continent, US President
But, amid all of the good news, there is a risk of overlooking the bad. According to a recent report on the UN Millennium Development Goals, the number of people in Sub-Saharan Africa who live in extreme poverty increased by more than 40%, to 414 million, from 1990 to 2010. The region still accounts for four out of five deaths of children under the age of five.
Obviously, growth has not been inclusive; the rising tide has left many boats behind. This is simply unsustainable.
Roughly 12 million people will enter the African workforce each year in the next decade; but, even today, young people account for 60% of all unemployed. Creating a sufficient number of rewarding jobs is a substantial challenge.
The answer to that challenge will vary by country, but it rests on reviving and reinforcing the manufacturing, agriculture, retail, and hospitality sectors, as well as technology-related businesses. We have already seen the positive impact that innovations such as so-called mobile wallets - mobile phone apps for banking - have had on facilitating payments and commerce, and on creating a new class of jobs in
Even more can be achieved by making broadband and technology more abundant and affordable. After all, if
Even under the most optimistic growth scenarios, a decade from now about half of Africa's workforce will still be employed in the informal sector, including micro and small enterprises. Facilitating the informal sector's growth and improving its productivity by widening access to finance and technology is imperative. At the same time, Africa's education system must focus on producing skilled and employable people.
Notwithstanding the emergence of a few world-class manufacturers, such as
Similarly, with 60% of the world's uncultivated arable land, Africa has a huge opportunity to feed the world's growing population and promote agriculture as a business. Yet, in countries like
To tap its potential in manufacturing and agriculture, Africa needs to focus on addressing its infrastructure deficit and the fragmented nature of its markets, as well as on improving regulatory quality, strengthening government effectiveness, and enforcing the rule of law - the basic building blocks of any development strategy. Investor-friendly policies also have a role to play.
Africa desperately needs to improve its hard infrastructure, such as power stations, airports, ports, roads, and railways.
Achieving the necessary scale is possible if existing barriers to free movement of goods and services across national borders are reduced or eliminated, and companies have the freedom to act on a regional basis. Currently, intra-Africa trade accounts for less than 15% of total trade - the lowest of any continent. The formation of regional blocs in Southern, East, and
The medium-term goal has to be a "true"
In addition to its low savings rate, Africa suffers from a multiplicity of sub-scale capital markets (the sole exception is
By ending state monopolies over telecoms,
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