ABSTRACT
What a difference a decade can make! In May 2000 The Economist headlined an issue ‘Africa a Hopeless Continent’, but a decade later in 2011, first Time and later the same year The Economist were singing paeans to Africa and how its rise was the next big thing in global affairs and it was poised to be the engine of growth – huge odds notwithstanding. Of course, there is no question that Africa, once derided as a drag on the rest of the world weighed down by all those problems associated with extreme backwardness and the political unrest and violence that were sweeping virtually the entire continent, has still to surmount several of these problems, but there is no denying that it is witnessing unprecedented shifts. Its share in global wealth is inching up steadily and by most estimates prospects for a continued robust growth in the coming years are bright (Devarajan and Fengler, 2013; World Bank, 2013, pp. 155-168). According to The Economist, ‘Africa is the world’s fastest-growing continent just now. Over the next decade its gross domestic product (GDP) is expected to rise by an average of 6% a year, not least owing to substantial foreign direct investments, which have gone up from US $15 billion in 2002 to 37 billion in 2006 and 46 billion in 2012’ (The Economist, 2013). Africa’s share in global trade has also increased from 1.85 to 3.1% in one decade between 1996 and 2011, from US$251 to 1151 billion (UNCTAD, 2013a, p. 8). Likewise, Africa
is the only region that has bucked the trend by increasing its share of foreign direct investment in the midst of global economic slowdown: it has gone up from 3.2 to 5.6%. The US$50 billion investments in 2012 were not limited to extractive industries alone; manufacturing and service industries are also becoming attractive destinations (UNCTAD, 2013b). As economists have been contending, the current boom is fuelled not merely by the demand for natural resources but because of steadily expanding manufacturing and service sectors and thus a progressively expanding market too. For instance, the region is the fastest growing mobile market in the world and there are already nearly 500 million connections in a population of about 850 million. Politically, the region is far more peaceful than probably it has been in the last several decades. Today more than half of the countries are democratic (compared with three in the early 1990s) and most others hold elections. The civil wars and political instability that plagued for decades have declined, although they have not completely stopped. Simultaneously, several social indicators show remarkable improvement. Consequently, there is no reason to doubt Africa’s continued good economic performance for the foreseeable future. Perhaps more importantly, the new emergent political and business elites understand the changing global dynamics and the need to leverage Africa’s advantages to reap the benefits of globalisation. According to World Bank Doing Business ratings 2012, a dozen African countries fare better than India on ease of doing business (International Finance Corporation and World Bank, 2012).
