Africa is preparing to take its place in a future global economy which will see the earth’s population reach 10 billion by 2050. As people are saying, Africa is where the ball is bouncing right now.
The continent is currently experiencing an average economic growth of between 5 to 8% a year.
It’s the youngest region in the world, and by 2040, is expected to have the largest workforce in the world at 1.1 billion people.
It is also one of the world’s greatest sources of raw materials, and, in many instances, has leapfrogged the developing world in terms of technological advancements.
According to McKinsey 7 Company’s report ‘Lions on the Move: The Progress and Potential of African economies’, Africa’s combined Gross Domestic Product will be $2.6 trillion by 2020.
By the same year, its own consumer spending by 128 million households with discretionary income is expected to be around $1.4 trillion.
Below, we take a look at the fastest-growing economies in Africa.
Economy: Zambia has had one of the world’s fastest growing economies for the past ten years, with real GDP growth averaging roughly 6.7% per annum. Privatization of government-owned copper mines in the 1990s relieved the government from covering mammoth losses generated by the industry and greatly increased copper mining output and profitability, spurring economic growth. Zambia’s dependency on copper makes it vulnerable to depressed commodity prices, but record high copper prices and a bumper maize crop in 2010 helped Zambia rebound quickly from the world economic slowdown that began in 2008.
Economy: Kenya is the economic and transport hub of East Africa. Kenya’s real GDP growth has averaged around 5% for the past several years. According to recently rebased national statistics, Kenya’s GDP for 2013 was $55.3 billion, placing Kenya among the low middle income countries with per capita income of $1,300.
Economy: Ninety percent of the population works in subsistence agriculture or mineral agroprocessing, while tourism, minerals, coffee, and tea round out Rwanda’s economy. Though the country has taken significant steps forward since the 1994 genocide, 45% of the population still lives below the poverty line.
Economy: Mozambique has attracted large investment projects in natural resources, which means the country’s high growth rates should continue. Some analysts believe that Mozambique might be able to generate revenues from natural gas, coal, and hydroelectric capacity greater than its donor assistance within five years.
But the vast majority of the country works in subsistence agriculture, and over half the population remains below the poverty line.
Economy: Tanzania has recently seen high growth rates because of gold production and tourism. The economy also runs on telecommunications, banking, energy, and mining, as well as agriculture. In terms of per capita income, however, the country is one of the poorest in the world.
5. Cote d’Ivoire
Economy: About two-thirds of the population works in agriculture-related industries. The country is the world’s largest producer and exporter of cocoa beans and is also a major player in the coffee and palm-oil industries.
4. Democratic Republic of the Congo
Economy: The Democratic Republic of Congo has huge natural-resource wealth, which it hasn’t been able to efficiently monetize because of systemic corruption, conflict, and political instability. That said, its economic is slowly recovering since the tumultuous 1990s.
Economy: Chad’s landlocked location results in high transportation costs for imported goods and dependence on neighboring countries. Oil and agriculture are mainstays of Chad’s economy. Oil provides about 60% of export revenues, while cotton, cattle, livestock, and gum arabic provide the bulk of Chad’s non-oil export earnings. Chad relies on foreign assistance and foreign capital for much public and private sector investment. The services sector contributes about one-third of GDP and has attracted foreign investment mostly through telecommunications and banking.
Economy: Modest oil resources and favorable agricultural conditions provide Cameroon with one of the best-endowed primary commodity economies in Africa. Cameroon devotes significant resources to several large infrastructure projects under construction, including a deep sea port in Kribi and the Lom Pangar Hydropower Project. Cameroon’s energy sector continues to diversify, recently opening a natural gas powered electricity generating plant. Oil remains Cameroon’s main export commodity accounting for nearly 40% of export earnings.
Economy: Ethiopia’s economy is mostly agriculture-based, but the government has made a push to diversify into manufacturing, textiles, and energy generation. But while the country has seen and will continue to see high GDP growth, per capita income remains ones of the lowest in the world.