Editor's Note: Eliot Pence is a Director at the Whitaker Group, a corporate strategy firm focused on sub-Saharan Africa with offices in Washington, DC and Accra, Ghana.
By Eliot Pence - Special to CNN
Since The Economist labeled Africa “the hopeless continent” ten years ago, the continent has changed dramatically for the better. While a number of factors contribute to the continent’s increased growth, four trends in particular standout:
1. Political stability ― Africa has slowly become more stable, if only marginally more democratic. Overall country risk, according to the Economist’s research outfit, EIU, of Senegal, Ghana, and Mozambique is lower than those of other emerging markets generally considered more stable, such as Argentina, Ukraine and the Philippines, and of the 17 elections Africa had this year, the majority were free and fair.
2. The commodities “super cycle” — 2003-08 was the third major commodity price boom since the Second World War (1951-53 and 1973-75 were the others). China’s resource intensive growth prompted the boom and substantially increased demand for Africa’s resources, pushing up the prices of hard and soft commodities by, in some cases, over 250%. In their 2010 report, McKinsey estimated that the commodities boom accounted for about a third of Africa’s growth.
3. Trade and aid — Public Private Partnerships, a concept that emphasizes collaboration between public sector and private actors, has opened up investment opportunities that would otherwise be unfeasible or unattractive by increasing risk sharing, technology transfer and sustainability.
4. A technological boom — Saying Africa “leapfrogged” through technology would underestimate the effect technology has had. Already, Africa has over 500 million mobile subscribers (up from 15 million in 2000). By 2015, Africa will have the highest mobile subscription rate in the world. African companies have also pioneered integrative technologies, such as mobile banking, where 1 in 2 mobile bankers globally is African (actually, Kenyan).
The Economist's reversal (they now dub Africa the "hopeful continent") may well become the bumper-sticker description for Africa’s remarkable change since 2000. But as the Economist itself notes, there remain massive obstacles — not least of which is marked by World Aids Day and the reality that fully 60% of people living with HIV live in Africa.
The views expressed in this article are solely those of Eliot Pence.
Whislt I agree with your four key reasons behind the gradual emergence of Africa, I beg to disagree that HIV AIDS is a major threat considering the current level of awareness and the good work of some groups such as the Gates Foundation. I would rather single out corruption and poor infrastructure as the major threat but as long as conscious effort is being made in those areas, Africa would surely be the final frontier
True, Africa has shrugged off its label as a "dark" continent. All the gloomy prospects in the past have given way to a rosy future, due to its rich deposits of natural resources. Yet corruption and cronyism will remain the biggest challenges for most countries there.
GO TEAM AFRICA!! PASS THE POPCORN...
Islam is not a negative factor for a country' s growth. Africa does have many resources that more developed states want, and new technology can help Africa have a high rate of growth faster than that of the west. Add in better education and helath care and the prospects really look good.
Agree with the synthesis. It is a good starting point; at least something we can build on. Not bad at all.
the only meaningful reason among the four is technology leapfroging. But the biggest is the end of the cold war which devastated africa and again the emergence of china that sees africa as a business pertner instead of the western imperialistic behaviour towards the continent.
I think its wishful thinking. Africa is the most resource rich country in the world yet most Africans never felt richer anytime in their history.
African politicians are able people – in making money for themselves. We call this corruption, they say its business as usual in Africa.
The wealth of rich African nations, like Nigeria, never trickle down to ordinary Nigerians. One of these corrupt ruthless African leader even ran his Government from a luxury yatcht! And his country's inflation shot up thousand percentages, and inspite of that he was still in charge. If he was ruling any other country he would be deposed long long time ago.
So you see, realistically, there is little hope for Africans at large. Unless there is a total change of political system and forcing their politicians to work for the people. Potential Africa leaders should be reminded that the days of the Pharaohl is in the past. This is the 21st Century when men are supposed to be more civilised.
Africans tyrants rule with a gun and slaughter of the helpless.
The economic cycle rotating around the universe is now tilting towards Africa where the cradle of human existence began . Europe especially Britain then called (Great Britain ) rode on the back of Africa using her ( Africa's) human and economic resources to develop Britain and other parts of Europe. The same situation is found in the U S A using African human and natural resources taken for free . Now that all African nations are independent and can freely market their resources in an open market to the highest bidder all over the world , the reality is now setting in on European and American ecomnomies.
The major problem confronting Africa today is curropt leaders who steal and rob the people of their money and stack them in European ,American and Asian banks . But soon ,and very soon this will be a thing of the past and Africa shall rise again .
Corrupt leaders are products of people who have abandoned their principles and sold their souls. in democracy (whether in its infancy or mature) you get the leadership you ask for. so when you say corrupt leaders, look at yourselves.
these were great points made but each African country is on a different level of development.
Corruption and government's inability to tax in orderly fashion are two areas that need work. Return on investment is relatively fair compared to risk factors (when comparing small business failure rate in developed countries like the US).
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