An Approaching Golden Age for Africa?

The World Cup continues as Namibia plays South Africa tonight.  Disappointingly, this appears not to have made the news in the Namibian newspaper New Era – this exciting rugby match apparently being less newsworthy than the country’s boxing, football, and acrobatic shot-stopping.  However, an interesting article on the Southern African country’s demography did make the news.
Desie Heita reports on a recently released research paper by Simon Freemantle, a senior analyst with Standard Bank's African Political Economy Unit.  In it he emphasises the potential of Africa’s young and fast growing population to fuel Africa’s future economic success.  She reports:

Economists see Namibia, along with Ghana, Cote d‘Ivoire, Malawi, and Mozambique, as countries with “a very high potential to benefit from the demographic dividend over the next two decades”...

Researchers argue that population growth in Africa over the next decades would mainly consist of a young generation that is affluent – with more money to spend and a longer healthier lifespan – in the process attracting investments from global market traders who wish to capitalise on such trading opportunities.

Agricultural production would increase with agribusinesses feeding the youth elite, who would naturally change their eating habits, while manufacturing and other sectors would benefit from the increase in demand for luxurious items. However, importantly, this success depends on the ability of these countries to strengthen internal infrastructure such as bureaucracy and healthcare:

“When balanced by generally positive economic growth [the youthful population] carries potentially potent benefits for those countries with the structural means to support a bulging populace, [but] in the absence of such supporting factors, population growth has the ability to be profoundly destabilising,” says the report. This researches’ optimistic view of Africa’s population growth and economy was supported last year by Wolfgang Fengler, the Lead Economist in the Nairobi office of the World Bank.  He argued that population growth could in fact signal a golden age of development for Africa, giving three key reasons for this view:

First, despite Africa’s rapid population growth and Europe’s stagnation (even decline in few countries) the old continent remains much more densely populated than Africa. If we look at Western Europe – where I come from – there are on average 170 people living on each square km. In Sub-Saharan Africa there are only 70 today. This gap will narrow in the next decades but even by 2050, Western Europe is expected to be more densely populated than Africa. I am following the population debates in Europe, especially in my (densely populated) home country Germany. I have never heard anyone argue that there are too many people in Europe. Interestingly enough, Namibia is currently the second least densely populated country in the world.  Plenty of room for growth?

Second, while the speed of population growth remains unchanged, its sources are different. In the past, population growth was driven by increasing numbers of children.  Today, and in the future, it is driven by longer life expectance and the “base effect” of the previous population boom...the fastest growing group in Kenya’s population is not anymore young children – but adults which will almost triple in size from 21 million today to about 60 million in 2050.

Third, population growth and urbanization go together, and economic development is closely correlated with urbanization. Rich countries are urban countries.  No country has ever reached high income levels with low urbanization. Population growth increases density and, together with rural-urban migration, creates higher urban agglomeration.  And this is critical for achieving sustained growth because large urban centers allow for innovation and increase economies of scale. These economists seem to be signalling that what Africa really needs is to be aided to build and develop the necessary infrastructure to support its increasing population.  However, the increasing population itself could well be a positive thing for future African prosperity and just what Africa needs?  And just imagine the headline-making rugby teams they could soon have...


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