With all the economic woes facing highly developed economies, it's heartening to read some good news about economic development in Sub-Saharan Africa.
The economic transformation that has taken place over the last decade has laid out a solid foundation from which to build on. According to the International Monetary Fund, real GDP in sub-Saharan Africa increased by 5.7% annually between 2000 and 2008, more than double the pace during 1980s and 90s.We're taking a few small electronic gifts for my brother's friends and colleagues: flash drives, memory cards, rechargeable AA and AAA batteries, and such.
The collective output of it’s 50-plus economies, meanwhile, reached US$1.6-trillion, far greater than, say, global industrial power Republic of Korea.
Not surprisingly, Africa’s impressive economic momentum over this period owes much to its natural resource wealth that includes a majority of the world’s platinum, chromium and diamonds and a large share of global oil and gas reserves and gold and uranium deposits. However, rising prices for these commodities is only part of the story. According to McKinsey, natural resources and related government spending accounted for 32% of Africa’s GDP growth, with the remaining two-thirds nicely distributed across other sectors, notably wholesale and retail, agriculture, transportation and telecommunications.
Underlying this economic breadth, says the report, is the African consumer. From 2005 to 2008, consumer spending increased at a compounded annual rate of 16% and rose in all but two countries. Millions of Africans have moved from the “destitute” level of income below US$1,000 a year to the “basic needs” level between US$1,000 and US$5,000. A smaller portion have moved into the middle income bracket of US$5,000 to US$25,000.
“There is a lot more going on than just natural resources,” Mr. Field-Marsham says. “The middle class is exploding. They are buying soap, they’re buying beer, they’re buying telephones, they’re building housing, and they’re buying cement. Now, everybody has a stake.”