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Africa leads the way out of recession

Andrew Harding | 16:30 UK time, Tuesday, 6 July 2010

Some encouraging headlines plucked from a mixed bag of projections from the African Development Bank's annual review of the continent.

- Overall, Africa's economies are projected to grow (unevenly) by 5.2% next year, making this the strongest region in the world in terms of climbing out of the global recession. East Africa is leading the pack.kenyabizafp595.jpg

- China will double its investment in Africa in the next few years, with the establishment of manufacturing parks seen as the next big development. The Brazilians and Indians are also moving in fast.

- The global economic crisis has nudged African countries towards more concrete reform of their tax systems. This is nowhere near as dull as it sounds. A key way for African governments to shake off their distorting dependence on foreign aid is to learn how to tap more effectively into local sources of wealth. The money is there, but the political will and administrative capacity are not. I'm sure the South African Revenue Service could provide some tips...

And now for a quick statistics quiz... Which African state's GDP grew by a whopping 20.5% a year over the past decade? And who came second with 11.6%? Which government spent the most on public education? And if the Comoros is the most unequal country on the continent (according to the Gini coefficient), which is the most equal?

Thanks for your replies. The answers, in order, are: Equatorial Guinea, Angola, Lesotho and Ethiopia. Congratulations to Longoae and Ethiopiawi. I wish I could tell you that your prizes are in the post.

Comments

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  • 1. At 6:20pm on 06 Jul 2010, jide wrote:

    5.2%? All well and good,but there will be no serious, deep and meaningful economic change for the majority of Africans until one fundamental is addressed.
    Mass education and literacy for the population.
    That is the number one poverty killer.

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  • 2. At 11:53pm on 06 Jul 2010, Paul S wrote:

    A cheap and cheerful viewpoint, but based on supposition and wishful thinking rather than any real substance. Be careful about messing with stats you don't understand or aren't able to support. Your "whopping 20.5% " is totally meaningless unless you quote the size of the GDP base it's coming off. Africa won't lead the way out of recession - it will have to be led. And the likes of China and other megapowers will do nothing to empower Africa, which will ultimately become a huge supplier of primary minerals with little or no export value added to stimulate local industry development.

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  • 3. At 05:15am on 07 Jul 2010, Ethiopiawi wrote:

    Somewhere in your answer Ethiopia should be there. For the last five years Ethiopia’s economy has been growing rapidly and doubling its GDP in the last decade or so. The country is spending a huge portion of its budget on infrastructure, education and health, and reducing its military spending. China has a lot to do with Ethiopia’s growth. It is just sad that the West is sleeping, and is hanging on its colonial heydays, and not wanting to do trade, instead deal with just AID!

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  • 4. At 07:30am on 07 Jul 2010, PKetema wrote:

    With growth in the U.S. and China slowing down, and Europe heading into another recession, it is no surprise that Africa is making headlines. If Africans are going to help themselves and the rest of the world out of the debt-laden economic mess that we are in, they must tackle corruption and invest in things that fuel economic growth. Many African countries have awakened and are doing precisely that, which is terrific. It is true that Europe and the U.S. kill African trade with their subsidies for domestic businesses, particularly agricultural products, and overpriced goods that no one can afford. The cure for that is for Africans to make things that they can sell to other Africans. A trade of equals is better anyway, and self-determination for Africans is long overdue. As for the GDP numbers posted above, Ethiopia, with its high 10+% growth rate in a non-oil-based economy, is the leader of the pack in terms of high investment in infrastructure and low corruption. Perhaps it can finally recapture its Adwa glory in the economic front!

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  • 5. At 07:39am on 07 Jul 2010, AnonymousCalifornian wrote:

    It's very good to read positive news out of Africa. I'm guessing that the 20.5% and 11.6% come from countries which were relatively poor (like how comparing China's 10% yearly growth rate to the US' 4-5% in the last couple of decades gives a distorted picture) but still with a fairly effective leadership. Maybe Tanzania (I'm guessing out of the blue here) for the 20.5%, and 11.6% for Botswana (I've read it is well-run)?

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  • 6. At 07:42am on 07 Jul 2010, derele wrote:

    Of course Africa will lead the world out of recession because her resources are there to be looted by the so-called western and eastern powers(now South Americans joining them) in collaboration with rogue African leaders! We are back in the era of colonialism but this time, 21 century economic colonialism!

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  • 7. At 07:44am on 07 Jul 2010, Andrew Harding BBC wrote:

    A fair point, Jide. Paul, you'll have to forgive my World Cup-induced optimism but as I made clear, I was picking some positive headlines from a far more nuanced report. As for the 25 percent - it was part of a quiz, not an argument! Answers on the way... The bank report has some inconclusive but interesting things to say about the spread of, and motivation behind, Chinese trade and aid - I'd say its analysis was marginally closer to Ethiopiawi's than to Paul's.

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  • 8. At 07:46am on 07 Jul 2010, AnonymousCalifornian wrote:

    @ Paul S:

    While there is a large grain of truth in what you've written, if Harding is correct that China is planning to develop manufacturing parks, that would contradict you. Manufacturing parks would indeed empower Africa by allowing Africans to add value to their raw materials. To a smaller degree this is also happening in Botswana, where a Dutch diamond company is now having diamonds cut in the source country. Brazil's government seems determined--for sentimental as much as practical reasons--to help Africa develop.

    So while one should not be overly optimistic, one should not be overly pessimistic either.

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  • 9. At 08:03am on 07 Jul 2010, Mr Koomson wrote:

    I wonder if Africa will ever become independent. Some of the best talent abroad is of African origin i.e. doctors, nurses and teachers. It is sad that this talent cannot be invested in Africa. Already in Ghana the Lebanese hold a high proportion of the wealth, now the Chinese will and once the Indians come then local people will not be able to compete with these business minded people and their ability to manufacture goods cheaper. The country will be swamped with foreigners and local people will lose out as will local culture and traditions. These people do not care about Africa they only care about making money and the consequences will be disastrous for local people. It’s about time Africa held on to its dream of independence and ran itself.

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  • 10. At 10:28am on 07 Jul 2010, longoae wrote:

    Here my suggested answers: Angola and Equatorial Guinea. Education: Rwanda and most equalitarian countries I will go for either Botswana or a former socialist country like Tanzania. Africa has no real middle class except in Nigeria and South Africa, I doubt Africa "leads the world out of recession" as Mr Harding suggests.
    More importantly Africa ,as whole, will a consistant annual growth rate of over 10% for decades to come to lift its people out of poverty. This is tall order when we add together all the constraints limiting growth at the moment such such poor infrastructure, limited education, commodity based economies, political leadership corrupt and no vision for their countries' future. The future is still bright with such a young continent but it is up to Africans to seize the opportunity, most notably by removing these kafkaian business procedures to discourage investment.....I am not sure these Indian, Chinese or Brazilian will stick around when they find out about the real costs of doing business in Africa.

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  • 11. At 1:25pm on 07 Jul 2010, Kingsley O wrote:

    Mr. Harding, please keep reporting good news about Africa.It is a welcome change. Unfortunately, it is impossible to please everyone. When you were reporting mostly negative news about Africa, people complained,including me. Some are now complaining when you report good news.Africans and the rest of the world, need to read good news about Africa for a change.Sadly, all we often hear or read about Africa tend to be negative.All Africans want, is a fair and balanced reporting which is sometimes hard to do because most foreign journalists bring their own biases and prejudices into their reporting.

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  • 12. At 4:17pm on 07 Jul 2010, lbandi wrote:

    I agree many will always have a negative view about no matter.These are the same folks who doubted China and other developing countries.The real smart people are in Africa doing business with Africans and keeping you away through media.Who wants to share opportunities anyway?Of cause it is mostly outsiders that seem to be making more money but I think it is unrealistic to think that international traders will not have their hands in the pie.

    When Africa used to depend almost entirely on Aid,both Europeans and Africans complained and now Africa is slowly trying to come up,the music is still the same.Corruption is everywhere the difference is developed countries have an educated thriving middle class who put pressure on governments through intellectual debates without taking arms.People have very short memories,Europe used to be very poor,when Mongols and Islamic caliphates to the point where there was even White slavery.

    Of cause we need experts from all over the world to continue rebuilding itself,no country build everything on its own. Western civilization was build on the back of slavery (cheap or free labour) and Africa will re-build its modern civilization on the back of International expertise.Very simple.Keep viewing Africa negative and ignore its development at your own ignorance and peril.Progressive Europeans/Americans/Asians are there working with civil societies on the ground day by day and yes it will take time just anything being built from ground up.

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  • 13. At 02:53am on 12 Jul 2010, dennisjunior1 wrote:

    Andrew:

    Wow, this is very important news--that Africa has the lead of leading continent out of Recession....

    (d)

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  • 14. At 11:46pm on 27 Jul 2010, Enny2012 wrote:

    Africa should never have gone into recession. What is great in a continent where a large number of the people live on aids. What is good news when many of African Leaders are looting the treasury, where human right means little or nothing at all. Childhood diseases, maternal deaths and lack of simple facilities set us back. Nigeria earns $300bn from petroleum yet, there is no electricity and safe drinking water. Roads are bad, and the democracy looks like a joke.

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