Glenn Davies: Africa vs The World - 2050
A new economic world order is emerging at lightening speed.
The underlying theme is that the economies we currently call “emerging” are going to dominate global growth over the next three to four decades. What’s exciting is the emergence of parts of Africa right across the continent. Attention will increasingly turn to the ‘new emergers’ as the world economy undergoes a seismic shift.
So what’s driving these ‘new emergers’ and what advantages can Africa exploit to be a dominant power in the years to come?
Well demographics will play a crucial role, helping parts of Africa finally emerge from economic obscurity. As the world economy is projected to grow at an average rate of just over 3% per annum from 2015 to 2050, doubling in size by 2032 and nearly doubling again by 2050.
In 2050 there will be almost as many people in Nigeria as in the United States, which means the potential of this country is huge as long as the government does manage to deliver the change that belies these projections.
It’s also worthy to note that Ethiopia will have twice as many people as projected in the UK or Germany. This is a country that is so often making the headlines for poverty and famine, but now appears to be making progress, and recently being named as one of the fastest growing economies in the world delivering more than 10% GDP growth. Many African countries will double in population in the coming years. In fact, half the increase in the world’s population over the next 40 years will be in Africa. Tanzania is also worth highlighting. Again, rapid growth in the population will see it reach almost 140m in 2050 – almost twice that of the projection in either the UK or Germany.
So who will become the Global Economic SuperPower?
It would be no surprise that China is projected to overtake the US as the largest economy within the next few short years; And most Analysts predict that India should rank between the first and third ‘global economic giant’ by 2050.
But what about Africa?
Nigeria is pegged to continue it’s economic boom and will have strong long-term growth potential with most predictions putting it in the top 10 economic power-houses. Egypt is also predicted as making it in the list of world's largest economies by 2050. An incredibly growing population which will top 130 million people will propel Egypt where Analysts believe it will rank as the largest African economy in 2050.
Unfortunately it’s not going to be an easy path for most African nations in the coming decades with a lot of work to be done. Africa has sadly been the lost continent for many decades and many parts of the region are still riddled with corruption, civil war and disease.
It’s sad to think that if we compare the average life expectancy of just 58 years today for Africa versus 71 in Asia and schooling of just 6.4 years compared with 8.4 in Asia are important drawbacks. Further, inflation and a total lack of democracy is a major problem for some countries.
Average real income per capita in Africa is just 7% that of the US with people in many countries living on less than a dollar a day. But, again, being ‘poor’, or at a low level of development, is not enough to guarantee growth.
Countries such as Angola and Uganda appear stuck in the poverty trap. But by assuming governments will improve these economic flaws, there is potential for change; only time will tell whether governments are able to deliver on this. Nevertheless, there are bright spots where already improvements have been made and the countries may be turning a corner.
Conclusion
The world has great potential to grow in the coming decades, but that growth will not stem from the developed world. As the ‘new emergers’ come to the fore, emerging economies offer great potential to power the global economy to 2050.
Africa is an exciting place, rich in diversity, incredible history and a proud people. Whichever countries emerge over time as the world’s major economic players, I think it’s very fair to say African countries will be among them.
Glenn Davies is Group CEO of Inigmah
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