Africa’s time has come: seven surprising facts

Africa’s economy is growing faster than that of any other continent. About a third of Africa’s 54 countries are seeing GNP growth above 6%. But not everything comes from diamonds and oil: only 24% of growth between 2000 and 2008 was attributable to natural resources. Where does the boom of this diverse and complex continent come from? Here are seven surprising facts about Africa, a continent whose economy is worth 2,000 billion dollars.

1. A huge market opportunity

A map drawn to scale shows how vast Africa is. 52 cities have a million inhabitants or more — as many as in Western Europe. The share of people living in cities is higher than in India and will reach 50% by 2030. The middle class is also larger than India’s, and by 2020 half of African households will have substantial purchasing power. Africa needs everything: infrastructure, education, health, consumer goods. And it can pay for them.

2. It is increasingly stable

Debt and inflation have fallen sharply over the past decade, as African governments are now broadly aligned with market economics. The number of coups has also dropped considerably since 1990. Though moving at different speeds, political reforms are under way, as shown by the “Polity IV” index, a democracy barometer on a 21-point scale (−10 for hereditary monarchies, +10 for democracies).

3. Soon the world’s largest pool of labour

Africa’s workforce will grow by 163 million people this decade. By 2035 it will be larger than China’s, and by 2050 Africans will make up a quarter of the world’s workers. Moreover, they will have far fewer dependants than any other population in the world. But major investment in productivity is needed to ensure broad, balanced growth across the region.

4. 20% of public spending goes to education

That is twice the OECD average (11%). Primary school enrolment reached 76% in 2008, up 14 points in ten years. Secondary enrolment (35%) is still low but has risen by 10 points. Educational attainment does not yet match the level of spending, but there are already remarkable successes: maths and science students in Ghana and Tunisia were among the world’s best in the 2000s. Education is the crucial factor that will decide whether the rapid growth of the workforce is a blessing or not.

5. It holds most of the world’s arable land

Natural resources are not everything, but they are an asset. With 60% of the planet’s uncultivated arable land, Africa can become an agricultural power. It is also rich in oil and gas: in Mozambique, Tanzania and Uganda, new fields could attract 40 billion dollars of foreign investment. Companies that only extract will not find lasting support in Africa. But those that build local supply chains, hire local staff and produce for the domestic market can win big.

6. Intra-African trade is in its infancy

Compared with Europe, Asia or Latin America, Africa has the lowest share of internal trade (11%). It is a fragmented continent, but a new breed of competitive pan-African companies and leaders is changing the game. Increasingly capable trade ministers and business leaders are promoting free trade within the five main trading blocs.

7. Mobile is booming

The mobile industry directly and indirectly employed 3.6 million full-time workers in Africa in 2010. From 2% in 2000, mobile penetration will reach 84% by 2015. Operators cut their prices by 18% on average in 2011. Mobile internet traffic in sub-Saharan Africa will grow 25-fold over the next four years. Companies will have to win over first-generation mobile customers: smartphones account for only 3% of the market, against 15% expected in 2015.