Is Africa going downhill?

By Jonathan Power

October 11th 2016.

Africa up or down? After 10 years of quite remarkable growth across the continent most countries are experiencing a downturn, with average growth nearer 3.75% than 5% as before.

Nigeria, the continent’s most populous country with its largest economy, was at one time growing year after year at 7+%. Now it looks like it’s heading for recession and a growth rate pointing to zero.

It has been hit by a six-fold whammy – oil prices sharply down, the effects of the great recession in the industrialised countries, the Chinese economy slowing, bad economic and foreign exchange policies under the relatively new president, Muhammadu Buhari, increased corruption under his predecessor, Goodluck Jonathan, and the war against Boko Haram in the far north.

Nevertheless, Nigeria’s non-oil sector- agriculture and manufacturing- improved steadily until 2015, but now has plateaued. Some economists have said that since that Nigerians can’t get richer from oil they are being forced to diversify.

Most African countries don’t have such a string of problems. Star performers, such as Tanzania, Uganda, Kenya, Senegal, Rwanda, Mauritius, Ghana and Ivory Coast, have avoided much of this turbulence. They have benefited from low oil prices, good economic policies, wise investment, an emphasis on industrialisation and an ability to attract foreign aid. Also from the lack of wars.

Although the number of wars across the continent has fallen sharply these countries have outshone their peers in either keeping the country peaceful for decades or by rapidly binding the wounds after conflict. The number of violent deaths is sharply down. A few states such as Somalia, Sudan and the Central African Republic are suffering from war but it remains a small number.

The latest ranking of the world’s most violent countries by the NGO, the Geneva Declaration, includes only two African states among its top ten – tiny Swaziland and Lesotho.

Look at Tanzania, one of the continent’s great performers. Right through the world economic crisis it has kept its growth steady at around 7%. Therefore it is doubling its income per head every ten years – in the capital, Dar es Salaam, every five.

It has increased manufacturing and mining at a handsome rate. It has had some success in battling corruption. It has made great discoveries of natural gas and thus is building up its electricity supplies. Its agricultural production is rising. Income distribution from richer to poorer has also improved.

Other countries have done even better in some ways. In Ethiopia industrialisation has spurted. It now about to assemble Chinese mobile phones. In Kenya and Nigeria the high-tech sector has become world-class, innovating across the board, pioneering money transfers over long distances and telephone-banking to go with it, that industrialised countries are only belatedly getting round to.

M-Koa, a Kenyan firm, is expanding across east Africa, selling its solar powered battery systems, which contain a torch and a mobile-phone charger.

Infant and maternal mortality have sharply improved almost continent wide. The number of people living on $1.90 a day has fallen steadily from 46% in 2012 to 35% at the end of 2015.

Compared with Asia this is insufficient but then Africa is still fighting population growth. However, in Ethiopia the birth rate is the same as London – around 2%.

Rwanda has not only picked itself up after the Great Genocide of 1994 with a high growth rate, it has almost rid itself of corruption and has improved its income distribution significantly.

Many African countries have found that they can increase wellbeing faster than some of the wealthier ones. Countries that do more with less – improved education, health, security and opportunity – include Senegal, Rwanda, Tanzania, Burkina Faso, Ghana and Kenya.

Trade barriers have fallen between some African countries and regional trade arrangements are increasing in number. Five of the ten fastest performers in the World Bank’s latest report on the ease of doing business are African.

Most countries are implanting sound economic policies, controlling government deficits and keeping inflation in check- as they have done over the last fifteen years. Also China remains Africa’s number-one trading partner and a heavy investor in infrastructure such as railways, ports, roads and bridges.

South Africa, the continent’s special case, since it is by far and away the most rich, is developing far below its potential. The corruption is severe. Money that should go on poor shanty towns is too often diverted. What should be a land of prosperity for all has become a land of degradation and missed opportunity.

Africa gets an unfair press.

Yes, corruption and administration are often bad – some say worse in some countries – but wars and famines are not spreading. There are some remarkably advanced cities like Calabar in Nigeria, Dakar in Senegal and Dar es Salaam, with healthy people and clean streets with trees and flowers planted on the verges.

There one can see the Africa of the future. Where is the press?

Copyright: Jonathan Power.

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