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You are here:Home>>Strategic Research & Analysis>>Africa rises to Europe’s debt-ridden cry for help
Friday, 24 February 2012 13:38

Africa rises to Europe’s debt-ridden cry for help

Written by Kasha Patel
President of Angola José Eduardo dos Santos (right), Portuguese ambassador, António Ribeiro Reles   President of Angola José Eduardo dos Santos (right), Portuguese ambassador, António Ribeiro Reles Angolapress

Ex-colony aiding its old master with Angola and Portugal’s role reversal

Not so long ago, thousands of Angolans were fleeing civil war looking for a better life in Portugal. Now the tables have turned. Angola's remarkable recovery from a poor, war-torn African country to a rising global oil power has been sealed with news that it will provide much needed aid to the debt-ridden country of Portugal.


"Angola already has large investments in Portugal's private sector, so they view buying in it as an opportunity," Monica Mark said in an article in the Guardian. The booming economy in Angola has also led many people of Portugal to pick up and move to Angola for business and career opportunities. In the end, the countries are helping each other out, as Portugal's aid from Angola is predicted to increase over the next year and Angola gains more workers.


From rags to riches, not only Angola has seen growing prosperity, but so have several other African countries such as Rwanda and Ethiopia. Overall, African economies are rapidly expanding and millions of people have moved into the middle class throughout the last decade. Around 60 million Africans have an income of $3,000 a year, and 100 million will by the year 2015, predicts the Standard Bank. This is good news compared to the low $700 average yearly income of most Africans.


"For many of the countries in the [African] continent there is now less conflict, better governance and greater government stability," professor of economics and Director of the Ahlers Center for International Business Denise Dimon said. "At the same time there have been better economic policies that have been more conducive for business growth along with a surge in demand for the commodities that Africa has to sell."


All of this has allowed the region to experience prosperity and continually improve development. This optimism only reaches so far, however, because most Africans still live on less than $2 a day.


"Food production per person has slumped since independence in the 1960s. The average lifespan in some countries is under 50 years. Drought and famine persist. The climate is worsening, with deforestation and desertification rates rising. Yet against that depressingly familiar backdrop, some fundamental numbers are moving in the right direction," The Economist said.


Population trends are also in Africa's favor as well educated young people fill the job markets and the birth rate declines.With more working-age people and less dependents comes increasing growth, and that is exactly what Africa needs.


With the growing number of workers comes a strong interest in technology, which is boosting economic prosperity as well. One example of this can be seen with the vast use of mobile technology. Africa has over 600 million cell phone users, more than America or Europe. Since Africa's roads are generally under-developed and unmanageable, advances in communications like mobile banking and other applications have been hugely beneficial.


China was the first to see prospects in Africa, and now more than a million Chinese are discovering opportunities for investment and trade throughout African cities and even in its villages. "China's arrival has improved Africa's infrastructure and boosted its manufacturing sector. Other non-Western countries, from Brazil and Turkey to Malaysia and India, are following its lead," the Economist said.


"The future [of Africa] is very exciting and optimistic," Dimon said. "I like the quote from Nelson Mandela, ‘It always seems impossible until it's done.' Well, the once seemingly impossible is now happening." Africa is now open for business.

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