chapter  1
16 Pages

Introducing the African economy

ByVISHNU PADAYACHEE, KEITH HART

Since the millennium, some observers have seen evidence of economic recovery in parts of Africa. This was fuelled partly by a rise in world prices for the continent’s minerals exports (see Freund below), partly by hot international money in the last years of the credit boom, partly by various endogenous developments. Thus in 2008 Angola had the highest annual growth rate in the world at 23 per cent, as a result of high oil prices, infrastructure reconstruction after three decades of civil war and the renewal of local enterprise. Some countries like Ghana seem to have embarked on a path of political democracy and economic growth, a factor in President Obama’s choice of that country to launch a new model of international partnership with Africa. East Africa is a world leader in low-cost computing and the use of mobile telephony for banking, commercial and administrative purposes. As we write, the global economic crisis is said to have snuffed out this precarious revival, with foreign investments drying up and commodity prices collapsed. But this judgment is premature.