GLOBAL trends tend towards urbanisation. And Africa is already having its own fair share of it. The question, however, is whether or not the continent is well prepared and if it is ready to cope with all the challenges associated with urban realities. While Africa will be a global attraction to the commercial world because of its population in coming decades, will it be prosperous enough to warrant higher investments by multinationals and local investors?
The challenge of human capital is daunting. For a prosperous Africa of the future, investment in healthcare, education and job-creating interventions will need to be amassed from the public sector, the private sector, the social sector and from the public-private partnership platforms that are pro-business and broadly entrepreneurial. National governments need to commit to higher funding of education, health and social protection for the poor to ensure inclusiveness in the spread of benefits.
True population of Africa still remains an educated guess. To know the strength of Africa, the appropriate population will need to be assured. This will depend hugely on correct, up-to-date and reliable data on births, deaths (and at what rates) and migrations. Armchair approach to population management is counterproductive in a number of ways. One of them is the false sense of figures, which become useful tools in the hands of dumb and disingenuous politicians for manipulating elections.
The armchair approach also impacts negatively on revenue allocation in which case more or less is allocated to some people or some geopolitical areas depending on the perception – rightly or wrongly – of population figures and their spread. If anything, population disaggregation based on gender, age, special conditions and possibly cultural underpinnings appears to be downplayed in the African context. An example is Nigeria in which population census has been used more as a political rather than planning tool. The result of the last census officially conducted in Nigeria wasn’t fully disclosed to the public and certain vital details were discountenanced for no justifiable reason if indeed the exercise was to live up to expectation.
We are told that Africa is a young country. But, by what yardstick are we to situate this acclaim? And in what ways has this disclosure or assertion influenced the young people? What programmes and policies specifically affect them in any significant way? What trans-generational policies are being implemented to properly position them for the future? How much access do they have to nutritious food that would build their brain and prepare them for a future driven by knowledge – a future that is right here with us now? What quality of education is there to prepare them for global challenges and opportunities? What kind of protection is there for them to help them live without fear and be able to bring out their very best?
The reality of trans-border movement of arms, particularly small arms, among entrenched interests in various countries in Africa is worrisome for safety and security. War-torn countries appear to be epicentres of dissemination of such arms which get sold for ridiculously small amounts in many destination countries. The upsurge, rising popularity, spread and splintering of militias and terrorists are destroying the economic bases of many countries. Rural countryside in many countries is becoming unsafe and economic activities in such areas are becoming endangered. Businesses that feed on vibrant rural areas in urban centres are in jeopardy. Food security is one casualty. Increase in migration to the urban centres will continue to influence the availability and prices of rural labour where supply may soon be below demand.
The shift in labour composition during the unfolding fourth industrial revolution may bode ill for Africa in specific ways as the signs are yet to emerge as to whether Africa is truly ready to be a force to reckon with in the unfolding realities. As many traditional technologies have been replaced by algorithm-based procedures, fewer and less manual labour will be required to do many things in the future. Automation and artificial intelligence will displace many hands and the labour market will experience redundancy as has never been known in modern history as many professions look set to disappear. How an Africa that isn’t a technological giant would cope is an issue that warrants deep introspection.
The cost of capital – and, in a narrow sense, the cost of borrowing – in Africa doesn’t compare favourably with the North America, Europe or Asia. That alone is a foreboding of the inequalities to expect in the world of investment except something drastic happens too soon to change the situation. Banks in the US, EU or in some parts of Asia (particularly in China) operate in ways that boost their enterprises to operate at lower costs and higher profit margins. Add this to cost of electricity generation. The real sector of Africa’s economy will need to grapple with these for some time to come. Investors hoping to come into Africa might be hopeful, but may remain reluctant based on costs and profits. Those that bring cheap money may somehow, sometimes, have to worry about the ease or difficulty of repatriating their gains.
The scores of many African countries on the yearly Ease of Doing Business could be a good pointer to the state of readiness of Africa for investment boom. A lot will have to change in these. Otherwise, many big investors will limit their operations to mere trading while keeping their core productive segments of the various value chains elsewhere, creating more jobs and more wealth outside Africa.
In the contemporary Africa, international businesses, NGOs and multilateral development organisations tend to have more reliable real-time current data on Africa than do various national governments. These are not encouraging signs of readiness of Africa for economic transformation. Countries in Africa therefore need to brace for transformation, for entrepreneurial approach to governance and evolve policies (across the board) that promote investment, human capital development, economic security, food security, social protection, infrastructural development, job creation in an increasingly competitive and constantly changing work environment that is becoming a global village.
Africa doesn’t have a Cisco outpost, an Embraer aircraft assembly plant or an apple phone assembly line. For any of these or other giants to come, Africa must do many things differently. The huge market potential inherent in the over 1 billion population can be unlocked when innovative opportunities are turned to wealth creation channels to enrich the people and raise their purchasing power. Many appear to have already seen the newly-established AfCFTA as a silver bullet. That may be far from the truth, especially if the various countries remain fragmented in policies, economies and still poorly integrated.
Notwithstanding the long-term differences in sizes, governments and in many other nuanced ways, Africa can overcome its internal obstacles to development and become global investors’ haven. This is possible only if a realistic SWOT analysis (Strengths, Weaknesses, Opportunities and Threats) is done by the various countries in a collaborative way and the findings brought into use for the purpose of reforming the continent. Since the world is in a constant state of dynamism, the fortune may only favour a well prepared and ready Africa.