Africa constitutes nearly 20 per cent of the world’s total land mass, and it is inhabited by about 17 per cent of the overall world population. However, Africa’s economies account for a mere three per cent of the world’s gross domestic product, GDP. The economy of Africa comprises the agriculture, trade, human resource, and industry. Most African countries capitalize in trading their mineral resources for example oils, precious metals like gold and diamonds and the agriculture sector for example tea, coffee and cocoa. The recent documented development has been based to growth in sales in commodities, manufacturing, and services.
In the next two and half decades, Southern Africa, west, East, and central Africa are anticipated regions to hit a combined GDP of nearly $30 trillion. Despite these important aspects, in the last eight years Africa was noted as the world’s poorest occupied continent where majority of the countries have not attained the middle-income status (at least $1,000 per person annually). Nonetheless, the status is set to change in the next four years if the prevailing growth rates remain steady.
Various factors have been attributed to the poor economic status experiences across the African continent. The first factor is drawn from history where even though the continent had numerous empires trading with several parts of the globe, most people resided among tribal rural societies. The other factor is that European colonization did not help but rather coupled with cold war led to economic, social, and partisan instability that have inhibited any meaningful economic development activities and strategies to be instituted successfully. In essence, endemic wars and unrest, coupled with rampant corruption together with despotic regimes have hugely hampered the economy within African states. Moreover, decolonization of the continent was marked by high fraught levels attributed to instability aggravated by cold war conflict. Poor governance has largely deprived the continent its potential. For instance, the resources meant for infrastructure have been misappropriated and there poor strategic planning to position the continent’s economy in the right direction.
In recent years, Africa in economic terms is the world’s fastest developing continent standing at about 6 per cent and the GDP is anticipated to increase by an average of nearly 7.5 per cent annually from the last seven years to 2023. Growth has been vivid throughout the continent, with more than nineteen countries posting 7 per cent or more on average growth rates annually.
Africa’s economy is expected to maintain better performance in the future. The decent performance is pegged on the expanding trade, proficient English language skills, augmenting literacy and education, cheaper labor, and splendid resource availability. Within the economy, a consumer class is emerging and it is anticipated to keep booing through the coming years. It must be noted that the continent has more than 130 million people whose household income exceeds $5,000, which implies that they can utilize about 50 per cent of their income on discretionary expenditure as opposed to necessities. Since the African union members introduced the new economic growth and development strategy, nearly 28 members average some of the most growing economies and this offers a great boost to the economic social and political incorporation within Africa.
It is then safe to conclude that the economy of Africa is on a steady upward growth and its impact will be recognized globally.
