Money Moves April 19, 2016 at 06:30 am

Top African Economies Suffer; Is There Hope?

Adedeji Ademola | Contributor, F2FA

Adedeji Ademola April 19, 2016 at 06:30 am

April 19, 2016 at 06:30 am | Money Moves

One of the recognizable goals pursued by African leaders at the wake of independence was the pursuit of economic development through cooperation and integration. The emergence of nationalist leaders who successfully negotiated independence from the colonial masters had challenged Africans to take care of their destinies. As Nweke Osita argued in the book –ECOWAS Three Decades of Enduring Legacies in the West Africa Sub-region, “It was reckoned that if independence was to be meaningful; the emphasis had to be on the economy”. Thus it makes a lot of sense that Africa embraced the idea of integration and cooperation from the outset.

Meanwhile, we should not forget in a hurry that for several years before independence, Africa’s economy had been subsumed under the global economy first through the Atlantic slave trade, then later colonialism, neo-colonialism and globalisation as we know it today. We can say all we can about those various concepts but the truth is that from the word – go, Africa’s economy has been tied to the apron strings of the “masters” and it was difficult for her to extricate herself. No matter what Africa does, she will always be at the mercy of the “masters”.

Suddenly, some years back, owing to an array of internal and external factors, Africa’s economy hitherto the underdog, came alive and became the darling of many investors all over the world. From Lagos to Luanda, Marrakesh to Maputo, businesses started booming. Advent of telecommunications in several parts of Africa, good fiscal discipline, the entrenchment of democratic ethos and good governance, reduction in number of conflicts all over the continent, rise in commodities, favourable external conditions, etc. aided this sporadic transformation. For some years now, economic growth in African countries hovers around 5%-7% increase annually while it is not so in other parts of the world. Thus, the appellation -“Africa Rising’”came to be.

Is Africa’s economy still on the rise? No matter how you look at it, growth is expected to continue howbeit slowly. In fact, there is a prediction that Ethiopia will record over 10% economic growth. This is a fact stated in the World Bank Global Economic Prospects 2016.

Can you beat that? Also, according to africaexponent.com, Kenya is expected to grow at a robust pace reinforced by large-scale infrastructure projects including the construction of Standard Gauge Railway which will boost domestic trade. Rwanda, Mauritius, Seychelles, etc. are recording fantastic gains from their tourism sector and Botswana, Ghana, etc. are recording remarkable economic gains.

Yes, there are major sources of concern in countries like Nigeria, South Africa, Angola owing to decrease in prices of major commodities in the global arena. Also, the slowdown in the Chinese economy who is one of Africa’s largest trading partners; the general weakness in the global economy; high-debt profile of many African countries; structural imbalances and policy ineptitude; lack of sufficient energy and transport infrastructure; continuous conflict in some countries like Nigeria which is taking a huge chunk in the money that is supposed to be used for development; undiversified economy and international shocks and conditions are major issues African countries have to look at.

Africa cannot be found wanting. A slowdown or retreat to the yesteryears will do no one any good. A strategic action plan for greater intra-African trade must be devised immediately and carried out. Africa must trade with itself.

Diversification of the economies and calculated pursuance of industrialization drive should be the next great thing. Unemployment and conflicts must be sorted immediately. But good domestic approaches are not the only factors worthy of consideration. A strategic partnership with the ‘great countries-US, Europe, China and other Asian actors’ must be brought into sharp focus for fair trade, equity and justice.

 

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