The calls for Africa to industrialize were strong in the 2010s, but towards the end of the decade, much of these sentiments waned.
Conversations in the corridors of investment banks and development agencies were that Africa was rising and that in decades to come, the continent would be able to pull millions from the fangs of poverty.
Much of this talk has dissipated and the continent now looks into a bleak future. Critics of the Africa rising narrative have pointed to the rapid GDP growth of the late 2000s and early 2010s as the main driver of the narrative.
But what most experts failed to consider was that GDP growth does not communicate a lot about an economy’s health.
And as soon as the global macroeconomic factors hit major African economies, the talk disappeared and the new reality set in: Africa was not growing at the pace many were made to believe. The economic growth disasters have left many experts wondering how the Africa Rising slogan turned sour even before taken.
Poverty, corruption, capital outflows, and low foreign direct investments (FDI) are still plaguing Africa’s growth agenda. And things seemingly will not improve in the foreseeable future.
A nuanced look at economic numbers across the continent indicates that most of the countries are stuck in a deep pit.
The myth
Critics of the African rising narrative have noted that while some countries on the continent have recorded impressive numbers over the past decade, the numbers studied over a longer period show that the continent has barely moved.
Major economies in Asia and other parts of the world have recorded astronomical growth over the same period, cutting poverty rates, and unemployment and improving public services. Examples often pointed out include South Korea, China, Malaysia, Singapore, and lately India.
Compared to other regions in the world, Africa’s share of the world’s poor has been rising. And the continent seems to fare poorly on almost all the other metrics, except higher birth rates.
One particular reason why people should be suspicious of the narrative is the fundamentals driving the narrative. Growth in Africa is largely driven by higher FDI and exports. This makes them vulnerable to the global macroeconomic environment.
All the top economies in Africa were worst hit by the COVID-19 pandemic and subsequently Russia’s war in Ukraine. While the rest of the world has recovered remarkably from these events, Africa is still struggling to find its footing, worsening the issues facing most countries on the continent.
Manufacturing and small businesses, which can drive employment and productivity, are still low in Africa. Most enterprises are still owned by multinationals that repatriate profits to their mother countries.
African startups struggle to raise capital, with most collapsing under the weight of overregulation, lack of capital, and low purchasing power. This is not likely to change any time soon.
Intra-Africa trade is still very low with initiatives made to open the borders for free flow of goods and labour fought by protectionist policies from respective governments.
The century-old problem of instability in the continent persists, with coups in central and west African regions.
The future
African growth agenda will not be driven by some sloganeering. A lot of work has to be put in place, and this will call for solid policies backed by good governance. African countries have not created a predictable regulatory environment that can encourage enterprise.
Well-thought technology, industrial, and tax policies must take the front seat if Africa is to compete with other continents. The normal cries that the rest of the world is exploiting Africa must be accompanied by policies that promote African growth.
Nearly two-thirds of the world was colonized in one way or the other. However, it is Africa that cries the loudest about the impact of colonization when policies are not aligned with the realities of growth.
