Africa's economies are booming
According to the International Monetary Fund (IMF) Africa boomed last year and should carry on growing fast in the next few years, even if commodity prices take a breather. The IMF says that "the pace of economic activity in sub-Saharan Africa (SSA) accelerated to 6.8 per cent in 2007".
The region's strongest growth was recorded by Angola, where oil and diamond production have both risen sharply while in Nigeria, "robust non-oil sector growth offset the drag from a decline in oil production in the Niger Delta".
Traditionally, South Africa has tended to be top dog in growth terms – it boasts the most advanced infrastructure and economy. But according to the IMF, "the pace of activity has eased modestly as tighter monetary policy, aimed at containing rising inflation pressures from food and fuel prices, has applied a brake to household spending". But, over the next few years, the IMF expects growth to pick up again, especially in the run up to the 2010 FIFA World Cup.
Rising commodity prices have been a huge boon to local economies. Volumes of manufacturing exports now represent a much larger share of regional GDP than commodity exports – see table below. But inward investment, especially in infrastructure and manufacturing, has also been a major source of growth. Net private capital inflows reached record levels in 2007. However, according to the IMF the bulk of foreign investment is still "focused on a few countries and targeted mainly at extractive industries, particularly the petroleum sector".
It's noticeable that the oil rich countries are on the whole experiencing faster growth, more serious inflationary problems and boast the best current account surpluses. Oil importing countries, by contrast, are growing more slowly, and have worse current account deficits.
So, what does the future hold for SSA? The IMF believes that growth in SSA during 2008–09 will "slow only modestly from the pace recorded in 2007. Growth will continue to be led by oil exporters, reflecting the coming on-stream of new production facilities in oil-exporting countries".
|Currency||Naira||Kenyan Shilling||Mauritius Rupee||Pula|
|GDP growth (real)||6.30%||6.90%||4.50%||5.40%|
|GDP per capita||$1.159||$845||$5.520||$7,888|
|Source : IMF World Economic Outlook|
Africa: how the numbers stack up
|Real GDP Growth (%)||Consumer prices (%)||Current Account Balance (% of GDP)|
|Great Lakes and East Africa||6||6.8||5.7||6.4||10.4||9.2||9.2||6.6||-4.4||-4.8||-8||-10|
|West and Central Africa||4.6||5.1||7||6.9||7||4.6||6.7||6.1||4.2||-1.6||2.4||2.1|
|CFA Franc Zone||2.2||3.6||4.8||5.2||3.6||1.6||3.9||2.9||-0.3||-2.3||-0.6||-1|
|*Projected. Source: IMF World Economic Outlook|
Some big facts
• US government studies show that 25 per cent of America's oil supply will come from Africa's Gulf of Guinea by 2015.
• 90 per cent of all phone users in Africa are mobile phone subscribers.
• In the mobile phone sector, average revenue per subscriber is just $3 per month. By the beginning of 2008, there were over 250m mobile subscribers in Africa and mobile penetration had risen from just one in 50 people in 2000 to almost one-third of the population today.
• Nigeria has maintained its lead as African's largest telecoms market with 47m active subscribers, relegating South Africa to second place with 42.3m subscribers.
• Sub-Saharan Africa's (SSA's) natural resource exports to China grew from just over $3bn in 2001 to $22bn in 2006.
• The Chinese are big investors in African infrastructure. Large hydropower schemes have been a favourite of China's, with Beijing providing $3.3bn for 10 projects by the end of 2007.
• China, India and a number of Middle Eastern Gulf Nations are financing a record number of infrastructure projects across SSA. The World Bank recently noted investment commitments in Africa by these emerging financiers jumped from less than $1bn a year before 2004 to $8bn in 2006.
• Transportation costs among African nations are 2.5 times higher than anywhere else on the globe, with transit times running two to four times higher than anywhere else.
• South Africa's middle class is likely to grow from 2.6m to 22m in the next 20 years, according to the Association of Corporate Treasurers of SA.
• According to UN-Habitat, Africa has both the world's highest urban growth rate of 4.58 per cent a year, and the highest slum growth of 4.53 per cent, roughly twice the rate in southern or eastern Asia.
• According to the African Development Bank, only about 3 per cent of renewable water resources in Africa are used under managed conditions, less than 6 per cent of cultivated land is under irrigation, and nearly 40 per cent of people lack access to clean water or sanitation.