New Economic Vibrancy In Africa

By M. Isi Eromosele

While Africa still faces some challenges, the 54 nations of this naturally beautiful continent has recently been enjoying an economic revival. The economic heartbeat of the continent has quickened and the overwhelming majority of its 54 nations are experiencing sustained economic growth.

Telecom, banking and retailing are thriving. Construction is especially robust and flourishing. Foreign investment is rising.

Our analysis at Oseme Consulting indicates that Africa is the world’s rapidly growing economic region. Africa’s improved economic momentum needs to be recognized by the global markets for what it is. It is a sign of tremendous advancement that portends great opportunities for global companies and investors.

Africa is changing fast. Cranes crowd the skylines of many of its capitals. Derelict buildings are being demolished and rebuilt. New homes and commercial office blocks are being developed at a maddening rate. Infrastructure development projects are being financed at a furious rate.

This as the world continues to hunger for oil, minerals and other precious commodities that are contained in African soil. Africa produces much of the raw materials that China needs and the Chinese has responded by making huge investment in many nations within the continent.

Not only have the Chinese government made direct financial investments in the region, it has also provided significant educational, health and cultural support. So have the Indians. Other western nations are beginning to take note of Africa’s emerging opportunities for global business.

Africa has greatly benefited from the price surge in the commodities that it supplies to major world nations. Prices for oil has risen form $20 in 1999 to the current price of $102 a barrel. Prices for minerals, grains and other material have also increased on rising global demand.

Yet, this is only part of the story. Other sectors contributing to this growth include wholesale and retail trade, transportation, telecommunications, manufacturing, financial intermediation, tourism, utilities, business services and agriculture. Economic growth has accelerated across the continent, especially in 30 of its largest economies.

We ascribe the major reasons for Africa’s growth to improved political and microeconomic stability as well as microeconomic reforms. Numerous wars came to an end, creating an environment for political constancy, necessary for economic development.

Many African governments took steps to lower inflation, reduced their foreign debt and shrunk their nation’s budget deficits. Additionally, African governments implemented policies that liberalized their markets, energizing them for foreign trade.

Many state-owned enterprises were privatized, trade barriers have been reduced, corporate taxes were cut, bank regulations were strengthened and legal systems were revamped. All these steps have resulted in the emergence and growth of private business sectors in many African countries, such as Nigeria, South Africa, Ghana and Kenya.

Accumulatively, these structural changes has propelled an African economic revolution, helping companies to achieve greater economies of scale, attraction of increased foreign investment and enabling these countries to be more competitive in the world markets.

M. Isi Eromosele is the President | Chief Executive Officer | Executive Creative Director of Oseme Group - Oseme Creative | Oseme Consulting | Oseme Finance

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