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According to the most recent compilation, five out of ten fastest-growing economies in the world are in Africa.The global economic growth forecast has been cut down to 2.4 percent from previously 3.0 percent by The World Bank for 2013. The slow down is being attributed to sluggish economic growth as aresult of recession in many parts of the world . United States of America has not fully recovered from past recession and Europe is now experiencing double dip recession due to large debt and deficit, rooted in excessive spending, weakening macroeconomic stability and bloated public sector. Africa continues to look hot with growth above 5.0 percent and with increasing foreign exchange reserve accumulation especially by Nigeria, Angola and Ghana.
2012 GDP: +7.80%
2013 GDP: +7.50%
GDP CAGR: +7.96%
Economy: Coffee has been a major export for the nation. While GDP growth rates are high, GDP per capita remains among the global laggards. In Ethiopia, the state owns all land, which is significant since agriculture accounts for over 40 percent of GDP.
2012 GDP: +8.10%
2013 GDP: +7.20%
GDP CAGR: +8.08%
Economy: This OPEC member has 85 percent of its GDP come from oil production and related industries. The nation remains marred by corruption and the land mines left over from decades of civil war. Most Angolans practice subsistence farming to make a living.
Source: World Bank, CIA World Factbook
2012 GDP: +8.20%
2013 GDP: +7.50%
GDP CAGR: +8.08%
Economy: 75% of Laos’ workforce practices subsistence farming, which accounts for around 30% of GDP. Foreign investment in hydro, mining, and construction has spurred Laos’ growth and reduction of poverty over the past two decades. Laos’ debt burden is modest compared to many of its Asiatic counterparts.
Source: World Bank, CIA World Factbook
2012 GDP: +7.50%
2013 GDP: +7.80%
GDP CAGR: +8.15%
Source: World Bank, CIA World Factbook
2012 GDP: +7.50%
2013 GDP: +8.00%
GDP CAGR: +8.73%
Economy: The majority of Mozambique’s population lives below the poverty line, and foreign aid accounts for half of its government’s budget. Aluminum comprises a third of the nation’s exports, and volatility in the commodity’s price has an impact on GDP growth.
Source: World Bank, CIA World Factbook
2012 GDP: +7.90%
2013 GDP: +8.40%
GDP CAGR: +8.77%
Economy: The world’s largest exporter and second biggest economy has gradually transitioned from an isolated, state-planned economy and introduced elements of free markets. An aging population, decreasing farmland, lack of domestic consumption, and reducing regional imbalances are downside risks to Chinese GDP growth. China is on the forefront of alternative energy development, particularly in solar.
Source: World Bank, CIA World Factbook
#4: Sierra Leone
2012 GDP: +25.00%
2013 GDP: +11.10%
GDP CAGR: +9.54%
Economy: Nearly half of the workforce engages in subsistence farming, which leaves the nation's substantial mineral reserves relatively underdeveloped. Diamonds account for about half the value of Sierra Leone's exports. In the past, these were primarily 'blood diamonds', though the nation has worked hard to repair its image.
Source: World Bank, CIA World Factbook
#3: Democratic Republic of Timor-Leste
2012 GDP: +10.00%
2013 GDP: +10.00%
GDP CAGR: +10.63%
Economy: Offshore drilling for oil and gas is the principal source of government revenues. The government has increased spending on infrastructure to continue to repair damages caused by Indonesian troops in 1999. Unemployment and dependence upon O&G are roadblocks to growth.
Source: World Bank, CIA World Factbook
2012 GDP: +11.10%
2013 GDP: +13.50%
GDP CAGR: +12.23%
Economy: Foreign investment inflows are expected to increase in the wake of US Troop withdrawals. Oil exports, the impetus for the nation’s wealth, have returned to pre-war levels. Adoption of free market principles, strengthening the legal framework for businesses, and developing Iraqi infrastructure are keys to the country’s growth.
Source: World Bank, CIA World Factbook
2012 GDP: +11.80%
2013 GDP: +16.20%
GDP CAGR: +13.60%
Economy: Mongolia successfully transitioned from a Cold War Soviet satellite state into semi-modern, mixed capitalist economy. Mineral deposits of copper, gold, coal, uranium, tin, and tungsten are the major sources of Mongolia’s wealth. Commodity exports – overwhelmingly to China – and foreign investment will drive GDP growth.
Source: World Bank, CIA World Factbook
It does not happen often, but five living American presidents recently gathered in Dallas, Texas to dedicate George W. Bush presidential Library. Political and ideological differences notwithstanding, there was a resounding conclusion that George W. Bush policy on Africa was most effective and generous especially his endeavor to combat HIV/AIDS crisis and signing peace treaty in Sudan.
When most people do contemplate on which American president is the best and true friend of Africa. I bet you, Obama and Clinton will probably come to their mind; the last person they that might think of is George W. Bush, the 43rd president of America. People may find it hard to accept that a Republican Party president was the one that extended a helping hand to Africa at the darkest and heighten period of AIDS/HIV crisis. The recorded history was the testament to the uncommon generosity offered by George Bush who persuaded the US Congress to fund AIDS relief to combat African greatest health crisis.
At the apogee of AIDS epidemic in Sub-Sahara Africa, due to poverty and inadequate medical and health facilities to manage the AIDS crisis, millions of Africans were dying. Therefore it became imperative that the rising AIDS threat to the continent must be combated before it assumed an explosive dimension and reaches a point of no return. And that was when Bush came to the rescue and joined the fight to daunt the rising tide of AIDS crisis in the world.
In 2003, President George W. Bush lunched “President's Emergency Plan For AIDS Relief (PEPFAR).” A relief fund to fight HIV/AIDS around the world including Africa where AIDS have devastating and debilitating effects on the people. Bush urged United States Congress to committee $15 billion over five years (2003–2008) to fight and combat the deadly disease.
Again in 2005, former President George W. Bush lunched another program known as Malaria Initiative. A five year commitment of $1.2 billion was set aside to combat malaria disease in 15 African countries where malaria has done the greatest damage to lives and wellbeing.
According to UNICEF, “Malaria is the leading cause of mortality among children under the age of five in this West African nation Malaria still kills 660,000 people every year, most of them African children. Insecticide-treated bed nets are critical to eliminating deaths from malaria—one of the leading killers of children in the world says UNICEF on World Malaria Day. The number of bed nets in sub-Saharan Africa has increased to 145 million thanks to bulk buying, joint procurement, financing and extending manufacturing capacity. Since 2000, 1.1 million lives have been saved from malaria, and malaria mortality rates in Africa have declined by one-third.”
Bush made one of the greatest attempts to hold back AIDS crisis. He was pragmatic and generous, without giving a lip service to the emerging calamity in the continent. Bush was thorough a compassionate person, he did not intellectualize nor become philosophical, rather he quickly acted to save a generation of people that AIDS would have wasted and annihilated.
Former President Jimmy Carter acknowledged Bush favorable African policy. When it comes to helping the poor and needy around the world including Africa, Carter is not a stranger in that area. Carter is authentic and has the credentials on building houses, providing health care and relief assistances to the poor and needy. Carter’s words are trustworthy and bankable; at the dedication of George W. Bush Library, former President Carter paid a glowing tribute to George W. Bush for his effectiveness and compassionate role in Africa:
“In 2000, there was a disputed election for several weeks and finally when President Bush became president they had the inauguration in Washington on schedule. I think my wife and I were the only volunteer Democrats on the platform. ..
The worst problem now is the war going on between North and South Sudan, and millions of people have been killed and I would like for you to help us have a peace treaty there. In a weak moment, he said I'll do it. He said well, I haven't even chosen them yet, but give us three weeks. Three weeks later, I came up. President Bush kept his promise. He appointed John Danforth and a great general from Kenya. In January of 2005, there was a peace treaty between north and south Sudan that ended a war that had been going on for 20 years. George W. Bush is responsible for that.
That was the first of his great contributions to the countries in Africa. As has already been mentioned, he increased his assistance to Africa until the time he went into office to more than $90 billion. That's an increase of 640 percent. That is development assistance. He established a program. There was 6,000 people being treated for HIV. Two million when he left office. At this new institute he has a program called pick ribbon and red ribbon. That is something that is dear to my heart and I know means a lot to millions of people in Africa. I am filled with admiration for you and deep gratitude for you. Thank you very much. “
Former President Bill Clinton said “I want to thank President Bush for passing PEPFAR. No president of my party could have passed that through the Congress, I have personally seen the faces of some of the millions of people who are alive today because of it.”
As of July 2012, former President George W. Bush visited Zambia and Botswana with his wife, former first lady Laura Bush to promote health initiative on treatment and prevention of cervical and breast cancer.
Bob Geldof, the musician turned social activist of Live 8 Concerts have in the past lavish praises on George Bush for his decisiveness in Africa, his words: "I read it has been incompetent - but not in Africa. It has created bitterness - but not here in Africa. Here, his administration has saved millions of lives."
While Bono an activist, the front man of musical group U2, spoke about Bush contribution in combating AIDS: “It’s incredible; it’s incredible what George Bush’s— President Bush’s name is in the history books. His name is in the front foreword of a book that’s written on the end of AIDS.” In another occasion Bono said to a crowd, “I know that’s hard for you to accept but George kind of knocked it out of the park. I can tell you, and I’m actually here to tell you that America now has five million people being kept alive by these drugs. That’s something that everyone should know.”
Before George Bush intervention, many of his African counterparts were struggling on how to cope with the health crisis. Some African leaders were giving the best they can to combat the disease but lack of fund and health facilities made it nearly impossible to hold back the surging disease.
Poverty was and continues to be greatest barrier to fighting AIDS in Africa. Poverty translates into lack of information and education which are the cornerstones for winning the battle against the deadly disease and saving lives. Indifference among some African leaders played a detrimental role in the consequential explosion of AIDS. These leaders were busy mismanaging resources and siphoning money abroad, as their people were suffering and dying. And it took an outsider without a personal or strategic interest to intervene and saved lives in Africa.
It is important to remember this great dispensation of helping hand that he aided to turn the tide in the struggle against HIV/AIDS. No one is saying that the battle against the crisis has been won, but the emergency fund from Bush’s America was successful in laying the foundation for the war against the disease.
Former President George W. Bush was not obligated to offer a helping hand but he did it anyway. What we can acknowledge here was that he did something extraordinary without expecting anything in return. For this act of great compassion, Africa is grateful and without doubt George W. Bush was and continues to be a true friend of Africa. Thank You! Mr. President.
Emeka Chiakwelu, is Analyst and Principal Policy Strategist at AFRIPOL.
Not since the countries of Africa tossed out their colonial masters several decades ago has there been this much optimism and excitement about the continent's prospects. While China's economic expansion has slowed, and while Europe and the United States try to dig themselves out of recession, Africa has not only weathered an up-and-down global economy -- it's been booming. Consider Nigeria's stock market, which gained 35 percent last year, or Uganda's, up 39 percent. But even more important is that real gains are finally being made on the ground in Africa today -- ones that speak to the possibility of a breakout phase that would lift millions out of utter poverty and great misery.
Let's start with the numbers. According to International Monetary Fund data, sub-Saharan Africa has grown at an annual rate of 4.8 percent over the last five years, a period that includes the trauma of the global financial crisis. That means it has outperformed other developing regions -- like Latin America, for example, at 3.3 percent -- and it blows out of the water the advanced economies, which expanded just 0.5 percent per year.
This is happening on a continent that has been saddled for decades with the worst levels of malnutrition, ravaged by preventable and treatable diseases, beset by corruption and rent-seeking, and scarred by a legacy of foregone opportunities. It is also occurring on a continent thought to be deeply vulnerable to negative external shocks, internal political upheavals, and now, sadly, terrorist movements.
No wonder there's so much excitement. Even the most discriminating investors are paying greater attention to Africa, which is all the more remarkable given that for decades the place was deemed virtually uninvestable. Now, from bonds to private equity, new vehicles are emerging to channel foreign investments into more of the most promising African economies. How real is the boom? Foreign direct investment in sub-Saharan Africa has leapt from $6 billion in 2000 to $34 billion in 2012. In just the past couple of years, several African countries -- among them Angola, Namibia, Senegal, and Zambia -- have issued external debt for the first time, allowing them to invest for the future.
Cynics might say they've seen this all before -- that 10 years ago, another great wave of anticipation about Africa's development merely gave way to disappointment. And yes, some things fizzled out; in some instances, countries were even left worse off. Witness what happened to Ivory Coast, once regarded as the jewel of Africa's development crown: It is only now emerging from a brutal, costly civil war that erased years of development.
We should be cautious, then, in saying that things are sure to be different this time around. Yet if one looks closely, cause for hope is on solid analytical soil. Africa's traditional growth story was built on rising prices for international commodities. But this proved neither sustainable nor inclusive, encouraging corruption and an unproductive rentier mentality among the ruling elite. There's a reason we think of Africa when we think of the resource curse.
This time, however, an expanding set of small- and medium-sized enterprises is bringing real economic diversification. According to World Bank statistics, these firms add some 20 percent to the continent's GDP and contribute roughly 50 percent of the new jobs in sub-Saharan Africa. These successful businesses are giving rise to internationally competitive companies, thereby providing access to global markets, new business models and technologies, and higher wages and salaries.
This can have a multiplier effect on long-term productivity of both labor and capital. As we've seen in Brazil and Mexico -- and now in Ghana and Kenya -- it slows brain drain by providing greater opportunities at home; it encourages nationals to migrate back home; and it engages the diaspora in enhancing the flow of capital and opening up new cross-border interactions. The ultimate benefit of all this, of course, is the promise of sustaining and nurturing wider prosperity.
This business boom is not just an isolated development limited to a few outlier countries. If these dynamics accelerate and attain critical mass in several major African economies, as I believe they will, the regional and global effects could be consequential. But there's still a lot to be done.
Right now, it is still cheaper (and easier) to export something to another African country via Europe or Dubai than directly. Clearly, regional trade suffers as a result. And though capital flows to Africa have picked up, they continue to be well below what economists would expect given principles of comparative advantage, consumption and production patterns, and, of course, per capita income.
There are other pressing needs too. Africa can't hope to really compete on the global economic front lines until it has broader electrification and a better transportation system. Unlike in decades past, however, the major driver needs to be the private sector, not some politician at a regional summit offering grandiose and unreasonable plans, or a celebrity do-gooder organizing a concert.
For the developed world, Africa's rise is not about charity or even just improving the livelihoods of the millions who live on the margins of subsistence. A growing, more prosperous Africa would assist the much-sought-after global rebalancing, helping the world find a less volatile economic equilibrium. A rising Africa eventually would provide a long-term source of global aggregate demand and a destination to engage foreign capital that is now overheating a smaller set of developing economies.
All this sounds very appealing, and it is. It is also far from automatic. Africa's rise can still be derailed by internal obstacles, especially the lack of adequate institutions in the public sector. Badly managed ministries and funding processes can contaminate development, especially if, rather than responding to people's needs, they allow for a concentration of power that not only enables corruption but raises the incentive for the existing political order to block any changes to the system, no matter how beneficial for the common good. It's no surprise then that African countries, on average, score in the bottom third of Transparency International's Corruption Perceptions Index.
It is the responsibility of Africans to recognize and address these risks. Yet the rest of the world can play a role in ensuring that this time, Africa's rise will be real and sustainable. The continent needs infrastructure projects, it needs risk mitigation, and it needs public-private partnerships that help build small and midsize businesses. What it doesn't need is a mindset that eternally treats Africa as an aid recipient. But most importantly, the West needs to get its own house in order to prevent currency wars or another recession that could imperil global capital flows.
Count me among the growing number of people excited and hopeful about what's happening on the ground in Africa. Markets are booming, and this time it's not just gold mines and oil rigs; it's a new generation of workers and entrepreneurs. Still a cynic? Don't take my word for it -- just follow the money.
Mohamed A. El-Erian is the CEO and co-CIO of PIMCO, a global investment management firm and one of the world’s largest bond investors with approximately US$1.9 trillion of assets under management as of September 1, 2012.
The George W. Bush Presidential Library dedication brought together five living presidents who have been at odds about much of the 43rd president’s foreign policy legacy, particularly the Iraq war. But they all agreed on, and offered effusive praise for, Bush’s work on Africa.
From the historic peace agreement between Sudan and South Sudan in 2005, to Bush’s work on HIV/AIDS and malaria, all the presidents, regardless of party, thanked No. 43 for his involvement in African policies and issues.
Jimmy Carter — who now runs the Carter Center, a non-profit organization whose mission is to fight for human rights, conflict resolution and global health in the world’s most impoverished countries — laid out Bush’s accomplishments, including increasing aid to the continent by more than 640% by the time he left office.
“Mr. President, let me say that I’m filled with admiration for you and deep gratitude for you about the great contributions you’ve made to the most needy people on Earth,” said Carter.
At more than $5 billion a year in humanitarian aid to Africa, President Bush has given more assistance to the continent than any other president. His administration’s aid was largely targeted to fight the major global health issues facing the continent, HIV/AIDS and malaria.
In 2003 Bush founded the President’s Emergency Plan for AIDS Relief (PEPFAR), which guaranteed $15 million to be spent over the course of five years on prevention, treatment and research on HIV/AIDS. Under the Bush administration, the U.S. was also a leader in contributing to the Global Fund on AIDS.
Though there was controversy over some of the qualifications for PEPFAR funds –up to 20% was to be spent on abstinence-focused prevention programs, and the funds could not be used for needle-sharing programs — most HIV/AIDS activists credit the program for being instrumental in turning the tide on AIDS.
Before PEPFAR, an estimated 100,000 people were on anti-retroviral drugs in sub-Saharan Africa. By the time Bush left office in 2008 that number had increased to about 2 million.
In 2005 Bush started a $1.2 billion initiative to fight malaria. He defended the request for funding in 2007, saying, “There’s no reason for little babies to be dying of mosquito bites around the world.”
At Thursday’s ceremony, President Clinton said in his travels throughout Africa he had “personally seen the faces of some of the millions of people who are alive today” because of Bush’s policies.
Even some of Bush’s most ardent critics have admitted that his foreign policy legacy on Africa continues to have a lasting effect.
U2 front-man and activist Bono, who criticized Bush on the Iraq War, nonetheless expressed his admiration for the Republican president on an appearance on the Daily Show last year, telling Stewart that Bush did an “amazing” job in the fight against the spread of HIV/AIDS in Africa.
“I know that’s hard for you to accept,” Bono said to a surprised crowd and host, “but George kind of knocked it out of the park. I can tell you, and I’m actually here to tell you that America now has 5 million people being kept alive by these drugs. That’s something that everyone should know.”
Since leaving office the former president and his wife, Laura, have continued to stay active in global health issues in Africa, now taking on cancer. The George W. Bush Institute has launched the Pink Ribbon Red Ribbon initiative to try and bring together both public and private investment to fight cervical and breast cancer in Africa and Latin America. The couple launched the program on a visit to Zambia and Bostwana in July of last year.
Early on, probably before I could even talk or walk, I was given the message that being black was an affliction, that as a black human being I needed to be adulterated, corrected, improved. Even my mother - born and raised in Nigeria - seemed to want to de-Africanise me as quickly and as absolutely as possible.
She started out by avoiding giving me an Igbo* name. Even my middle name is as caucasian as can be. Within days of my birth, I was plunged without warning into white culture like a screaming lobster being dropped into a boiling pot. I was a few days old when my mother sent me to be raised by a white family in an enclave of rural England where the population was 100% white (until I arrived.) Years later, my mother would boast to her relatives and peers that you couldn't even tell I was black when you heard me speaking on the phone. Bizarrely, and sadly, people actually seemed to be impressed.
Growing up in my white foster home, in my white town, some of the earliest words I heard about myself were: "we're at our wits' end." "We've tried everything." "Don't know what to do for her - poor little mite."
Was I suffering from a terminal illness? Had I been disfigured in some way? No, I'd simply been born black with afro hair. This reality in itself was presented to me as a tragedy. The afro hair needed to be altered, disguised, hidden, in order for me to be acceptable and accepted.
But then when I was six I finally visited Nigeria. Being reunited with my Nigerian family, finally seeing other people who looked just like me, taught me to accept myself, right? Wrong. My Nigerian family praised me heavily for my white accent and for the fact that my skin's a few shades lighter than most of our family members. Meanwhile, they criticised the "tough" texture of my hair, the flatness of my nose. One aunty said: "You're beautiful but what a shame you've inherited this same ugly African nose we have."
Upon my return to England, the Hair Wars began in earnest. During a weekend visit to my mother's home (I was still being raised in the countryside, by my white foster family), my mother took me to a hair salon to literally straighten me (or my hair, at least) out.
Years passed and still this corrosive idea lingered, this idea that our blackness has to be altered, covered up, in order to be deemed decent. Twenty years later I was the mother of a young daughter who'd begun asking me what was "wrong" with her hair and why it didn't flow and hang straight like the white girls' hair. I sat there, wearing a straight silky weave, trying to convince my daughter that her natural hair was beautiful. The weave sat on my head, contradicting my words, begging the question: if unadulterated African hair is so beautiful, so acceptable, what's with the weave?
That very weekend, I took the weave out and went to visit my mother sporting my huge and gorgeous new afro. My mother, who was still, after so many years, refusing to give me an Igbo name, took one look at my hair and said: "I beg you not to enter your office on Monday with that hair." My stepfather darted into his bedroom and returned with a bottle of Sta Sof Fro and he sprayed it at my head as if spraying Raid at a roach. He advised me to at least keep the hair "low" if I must wear it like that at all, so as to avoid drawing attention to it.
But why shouldn't I draw attention to it? Asian women are praised for their long straight shiny black hair. Why shouldn't I show off my healthy, thick, inherently African textured hair? Of course there are far more important things to think about than hair. But for me, hair is an emblem. The question is: why is anything distinctly black seen as a fault in urgent need of correction?
*The Igbo people are an ethnic group of south-eastern Nigeria.
PS: My mother finally gave me an Igbo name: Obinne, which means "a mother's heart."
Obinne Precious Williams is a Journalist, author of the memoir PRECIOUS (Bloomsbury 2011) Twitter: www.twitter.com/preciousthebook
In the past, most of the U.S. Business community regarded Black Africa as the exclusive domain of the former European colonial masters. With the unprecedented economic and political changes that have taken place in the last decade, American investors have come to realize the vast potential of Africa as a place to invest. From Ethiopia's and Mozambique's impressive growth rate, to Rwanda's spectacular economic reforms, Africa is seeing a dramatic economic and political transformation. This trend is spurred by the emergence of better democratic governance, creating more trades than aids, improved business policies, a liberalized market oriented economy and improved infrastructure.
Today African economies are growing faster than any other part of the world. Of the ten fastest growing economies in the world, seven (7) are in Africa-Ethiopia, Tanzania, Mozambique, Ghana, Republic of the Congo, Zambia and Nigeria. International finance agencies predict that by 2018, Nigeria will be the biggest economy in Africa, instead of South Africa. By 2025, the Nigerian economy will hit the hit the one trillion dollar mark. Over the past 6 years, Rwanda has been rated as the second most reformed economy in the world after Georgia. Direct foreign investment in Africa for the year 2011/2012 totaled about $50 billion.
What do you need to know before embarking on a business venture to Africa?One of the first mistake people do is to see Africa as one entity, instead of about 53 different entities with different languages and culture. Most of these African countries, adopted the language and business culture of their former colonial masters. The Francophone countries like Ivory Coast, Gabon, Burkina Faso, Senegal, Mali have a different business culture from the Anglophone countries like Nigeria, Gambia, Ghana, Sierra Leone, Kenya, Uganda, Zambia, etc. On the other hand, the Lusophone countries like Angola, Mozambique, Guinea Bissau, and Cape Verde have a different business culture, while Equatorial Guinea has a Hispanic business culture. In addition to these, one has to understand and deal with the local languages and culture.
With all these complications and obstacles in mind, how does one navigate the African business terrain successfully?. First, you have to have an agent or adviser who understands the cultural nuances of the continent and has political connections.
Secondly, you have to show patience and take a long term view. Don't be in a hurry to sign a contract, because Africans generally take their time. Third, keep quite, listen and observe before offering an opinion. Fourth, don't complain publicly about anything-no water, electricity, bad roads, corruption, etc. Instead, confide in your close African Friend. Fifth, avoid conversations about politics and religion. Politics can get you detained or declared persona non grata, while religion will get you more unwanted enemies. Sixth, Keep the racial issue in the back burner. Race should not be an issue in interactions with Africans who tend to be color blind. Africans do not see the White man as “oppressor”, but instead as an outsider. Seventh, avoid using your left hand to eat or shake hands.
Africans regard it as an insult to eat with your left hand or shake hands. The left hand is regarded as the “devil's hand”. Eight, never call anybody by their first name, unless specifically authorized. Always use Mr, Monsieur, Senor, Dr., Chief or whatever their honorific title is. Nine, the key to doing business and developing professional relationships in Africa is socializing. Socialize with the local people, because socialization builds the personal trust that is a prerequisite to doing business in Africa. Ten, confirm the bona fides of a potential business partner, in order to avoid been duped. Eleven, beware of the Foreign Corrupt Practices Act of 1977 which bars Americans doing business overseas from giving or receiving bribes.
What kind of business opportunities are available for investors and exporters?. Although about 70% of U.S. Business with Africa is in crude oil from Angola, Nigeria, Gabon, Republic of the Congo and Equatorial Guinea, manufactured items head the list of exports to Africa. These include drilling equipments, motor vehicle parts, computers, telecommunication products, construction machinery, aircraft and parts, household goods and agricultural machinery. Investors can invest in agriculture, tourism, mining of solid minerals, infrastructure, household goods, telecommunications, health care and education.
Which are the easiest countries to do business in and which are the best to invest in. The World Bank and IFC Doing Business 2012, lists 10 countries as the easiest to do business in. In descending order, these are 1. Mauritius, 2. South Africa 3. Rwanda 4. Botswana 5. Ghana 6. The Seychelles 7. Namibia 8. Zambia 9. Uganda 10. Kenya.
The World Bank used eleven criteria in choosing these countries. These are getting electricity, registering property, protecting investors, paying taxes, enforcing contracts, resolving insolvency, dealing with construction permits, starting a business and employing workers. However, being one of the easiest countries to do business, does not mean one of the best to invest in. The ten (10) best countries in Africa to invest in are South Africa, Nigeria, Angola, Mozambique, Ethiopia, Tanzania, Ghana, Botswana, Mauritius, and Kenya. These countries have a stabilized democratic political climate, liberalized free market, potential market( large populations), huge domestic raw material base, abundant and inexpensive labor force.
Nigeria leads the continent with the number of newly registered companies yearly, with 70,000. South Africa comes second with 30,000 and Kenya comes third with 22, 000.The worst countries to do business in Africa, include Chad, Central African Republic, Democratic Republic of the Congo, Sudan, Liberia, Burkina Faso. It is significant that there are no Francophone countries on the list of the best places to do business or invest.
African Caribbean Institute of Nashville and allied organizations has been in the forefront of pushing for investments and exports to Africa and the Caribbean, by holding regular business seminars, workshops and lectures. Its program of partnering African and Caribbean businesses with those in the United States and Canada has become a model. It also provides technical assistance to small business wanting to do business in Africa.
With the U.K. becoming the first G-8 country to spend 0.7 percent of its gross national income on overseas aid, the government’s recent budget was an exciting moment for the international development community.
But with extreme poverty falling all around Africa, and the continent’s mineral resources providing more revenue now than international aid, some observers are asking whether international aid is out of date. Africa needs trade, not aid, they say. In truth, however, they still need both.
Africa has the world’s fastest growing population, expanding by more than 20 million every year, and must create jobs fast to keep its unemployment rate from rising. Some analysts highlight the Middle East, where failure to generate enough jobs for young, urbanized populations had catastrophic consequences for political and economic stability.
Trade – in its broadest sense – will create the jobs that Africa so badly needs. So Africa’s leaders must identify and nurture labor-intensive industries such as agriculture, manufacturing, and hospitality in order to create more jobs.
It can be done.
When Mali’s government built infrastructure (including refrigeration) to deliver mangos from landlocked Africa to Europe, transport times dropped from 25 days to as little as 12 days, while mango exports increased more than 1,000 percent over 15 years, the World Bank has noted. The success brought jobs and income for Malian farmers, and set an excellent example for African agriculture, which accounts for more than half of the continent’s workforce.
Similarly, according to the World Bank, when Cape Verde offered tax breaks to foreign investors, tourism revenues climbed to about $540 million in 2008, from $23 million less than a decade earlier, and the sector now accounts for 21 percent of the country’s workforce.
In Nigeria, meanwhile, the deregulation of the telecoms sector generated an estimated three million jobs, as private sector enterprise thrived in the absence of state monopoly.
I’m so convinced by the need for trade, by the way, that I launched my “8 Miles" African equity fund (named after the shortest distance between Europe and Africa) to invest in companies that provide jobs and long-term growth.
This belief in trade is entirely consistent with a profound respect for aid. I have learned that one begets the other.
The 2005 Gleneagles G-8 summit, for example, brought debt cancellation and increasing levels of aid that helped to school tens of millions of children and triggered an intellectual stampede that is propelling at least some of Africa’s rapid economic growth. Today, Africa has some of the world’s fastest growing economies and foreign investors are tripping over themselves for a slice of African profit.
Almost two dozen of Africa’s 54 nations have now reached middle income status, and more undoubtedly will do so by 2025. As noted by the World Bank’s lead economist in its Nairobi office, if sub-Saharan Africa were a single country, the World Bank would already classify it as middle-income, with an average income of more than $1,500.
But Africa, like every other continent, needs its aid.
Away from the investment analyses and high growth headlines, some 40 percent of Africa’s one billion population still live on $1.25 per day or less. And, as UNICEF notes, in 2011 some 19,000 children were still dying every day from deaths that might have been prevented with measures such as routine immunization.
“In sub-Saharan Africa, a woman faces a 1 in 39 lifetime risk of dying due to pregnancy or childbirth-related complications,” the U.N. Population Fund says. “In South-eastern Asia the risk is 1 in 290 and in developed countries, it is 1 in 3,800.”
“Bad aid” can be ineffective, it’s true. My favorite story is the construction of a giant fridge in Kenya’s remote Turkana region so that local communities could eat and sell fish from the nearby lake. Local preference for goat was one obstacle to success. Lack of electricity was the other.
But aid these days is better: less wasteful, more ambitious. Amongst many other improving stats, maternal and child mortality are coming down, backed by development aid that is focused, measured, transparent and smart.
Innovative organizations such as the GAVI Alliance use market incentives to encourage lower prices and the production of vaccines for African children. In West Africa, 100 million people have now been immunized with a new vaccine against meningitis A, a deadly disease that had previously plagued the region for more than a century.
Some may believe that aid’s primary motivation may be moral outrage. That's a good start, but its primary purpose has always been to serve practical interests too.
Last month, more than two dozen British CEOs reportedly signed a joint letter that applauded the U.K.’s commitment to overseas aid. They argue that developing countries become emerging markets, the engines of global growth, and aid contributes to this process, they said.
Imagine that very soon, Africa will be the world’s largest consumer market, bigger than India or China.
By then, traditional aid will focus more on emergencies and fragile states such as the Somalia and the Democratic Republic of Congo. Aid will transfer knowledge not money.
We’re already moving in that direction. In 2010, Global Witness reports, Africa’s oil, gas and mineral exports “were worth roughly seven times the value of its international aid,” representing enormous opportunity and risk for the continent. If used wisely, these resources could fund health, education, energy and infrastructure. If not, they could fuel corruption, conflict, and political instability.
Africa’s mineral wealth throws up a profoundly complex set of issues. If the continent is so rich, why are so many of its people so poor? How does a government manage its revenue from mineral resources without destabilizing the economy? How can the international community support the fight against corruption? How can everybody work together so that Africa’s precious – and finite – resources reach more people with jobs and opportunities? The Africa Progress Panel will suggest a set of policy options when it releases its latest report on May 10.
Trade, jobs, and opportunities remain critically important for Africa. Aid is changing, but will stay essential for the poor of our world for a long time to come.
Bob Geldof is a member of the Africa Progress Panel, chaired by Kofi Annan, and a musician, businessman and campaigner against poverty.
More than half of Africa's one billion population has a mobile phone - and not just for talking. The power of telephony is forging a new enterprise culture, from banking to agriculture to healthcare. Africa has experienced an incredible boom in mobile phone use.
In 1998, there were fewer than four million mobiles on the continent. Today, there are more than 500 million. In Uganda alone, 10 million people, or about 30% of the population, own a mobile phone, and that number is growing rapidly every year.
In the west, we have been adapting mobile phones to be more like our computers: the smartphone could be described as a PC for your pocket. In Africa, where a billion people use only 4% of the world's electricity, many cannot afford to charge a computer, let alone buy one. The most dramatic example of this is mobile banking.
Mobile phones carry huge economic potential in undeveloped parts of Africa. A 2005 London Business School study found that for every additional ten mobile phones per 100 people in a developing country, GDP rises by 0.5%. As well as enabling communication and the movement of money, mobile networks can also be used to spread vital information about farming and healthcare to isolated rural areas vulnerable to the effects of drought and disease. Fewer than four out of 100 Africans currently use the internet, and broadband penetration is below 1%. Texting isn't just for late night conversations and killing boredom - it's used to conduct business all over Africa.
Underestimating the potential of Africa
People in the West are fundamentally uneducated about Africa. And it's not only the people in the street, even the educated classes know little about the continent. That's why companies and institutions systematically underestimate the potential of Africa. Two stereotypes dominate Europe's image of Africa. The crisis stereotype emphasises hunger, poverty, conflicts, corruption and widespread mismanagement, thus creating an image of helplessness, incompetence and inferiority.
The exotic stereotype accentuates the natural beauty of the landscapes, the colourful cultures expressed in textiles, music and artefacts, the mysticism and the smiles of the poor.
While both stereotypes have more than a grain of truth in them, at least two important aspects are lost in the caricatures: first, Africa's many important assets outside and beyond the stereotypes, such as widespread vibrant entrepreneurship, sophisticated intellectual elites and the ambition to be seen as a respected partner in the global community; and second, the diversity between regions, countries, cultures and socio-economic classes.
Generalising about Africa based solely on the examples of the crises in Congo-Kinshasa, Somalia and Zimbabwe is short-sighted and misleading. The differences between countries like Ghana and Nigeria or Rwanda and Kenya are at least as big as the differences between any two European or Asian countries.
An entrepreneurial generation on the rise
African economies score some of the highest growth rates in the world, political stability is improving and a young, highly entrepreneurial generation is on the rise. And while many of Africa's problems deserve global attention, the solid business success stories beyond the crisis and the exoticism must be told as well. Not only do they provide surprising insights into the present and future of the continent, they are also the key to continuing the current rise of Africa.
During the last decade, Africa has outgrown the world economy and, despite the recent financial crisis, this trend is projected to continue in the future. For some technologies Africa even exhibits the highest growth rates in the world, mobile communication being the most prominent example.
Despite these developments, the global technological gap is most persistent, poverty is denser than elsewhere and less is known about technology in Africa when compared with other developing regions. The combination of a highly dynamic region with excellent opportunities for development on the one hand, and a desperate need to improve the quality of life for a large part of the population on the other, makes Africa an exciting and worthwhile project target.
Looking to the future
According to the IMF's 2010 World Economic Outlook Database, by 2015, sub-Saharan Africa's GDP is expected to near 2.5 trillion international dollars, of which the top ten economies account for almost 2 trillion international dollars. Interestingly, at the projected growth rates, Nigeria will overtake South Africa and become the largest African economy well before 2050. One driver of this economic growth lies in the high resource prices that have favoured African economies for most of the decade. But this is far from the whole story.
Angola and Nigeria have certainly grown on the back of oil and gas. However, a long list of African countries has managed to diversify their economies significantly. In Côte d'Ivoire, Namibia, Zambia, Senegal, Cameroon, Kenya, Ghana, Mozambique, Tanzania and Uganda, the contribution to GDP of the manufacturing and service sectors, such as construction, banking, telecom and retail, surpassed 65% in 2008, and is continuing to rise.
These changes are reflected in the mirror windows of the business districts' office buildings. They can be seen in coffee shops, where young urban professionals work at their laptops; they can be seen on Facebook, where millions of Africans network; they can be seen in the increasing number of African blogs and discussion forums.
Technology supports many of these developments and Africa's 21st century will be a century of technology-driven change. This makes one think that Thabo Mbeki's vision of an African Renaissance might well have been a real strategic revelation!
Richard Firth is the CEO and chairman at MIP Holdings.
Only 11 days since taking over as Chinese president, Xi Jinping is already in Africa.
He spent Monday in Tanzania and will next attend the BRICS summit in seaside Durban, South Africa, before winding up his tour in Congo-Brazzaville. Speaking in a new Chinese-built conference hall in Dar es Salaam, Tanzania's largest city, Xi conveyed a continuation of China's policy toward Africa under the previous top leadership.
"China will continue to offer, as always, necessary assistance to Africa with no political strings attached," according to Reuters. He added, "We get on well and treat each other as equals."
Xi hailed Africa as the "continent of hope and promise," and spoke of Beijing's "sincere friendship" with Africa. He also indirectly addressed the criticism that China is only interested in exploiting Africa's natural resources.
"Africa belongs to the African people," he said, according to Agence France-Presse. "In developing relations with Africa, all countries should respect Africa's dignity and independence." Xi is no newcomer to the continent—this is his sixth visit to Africa, the last being in 2010.
Throughout the trip, Xi and his team will be announcing an array of trade and development deals. At the BRICS summit, the Chinese are expected to jointly back a development bank along with fellow members Brazil, Russia, India and South Africa. Xi is scheduled to sign around 20 trade, development and cultural agreements, before journeying to Durban.
He renewed an offer of $20 billion in loans to Africa between 2013 and 2015 and noted that trade between China and Africa had reached some $200 billion in 2012. However, much of the attention may be focused not on Xi but rather on his glamourous wife Peng Liyuan, a famous folk singer in China who stole the show during the first stop on the trip, in Russia.
China imports many raw materials, including minerals, from resource-rich Africa. Chinese imports from the continent reached $113 billion last year, a 20-fold increase over a decade. GlobalPost senior correspondent Benjamin Carlson called Xi's visit Africa "a fascinating, intriguingly symbolic second choice for a foreign visit after Russia."
Xi's visit may be a sign that China's primarily economic interest in the continent may be extending to political influence as well. "Chinese media is filled with glowing reports about China's harmonious relationship with African countries now, so clearly there's a propaganda imperative to portray relations as improving now," Carlson said.
Source: Global Post
He was speaking in Tanzania - the second country he has visited since taking power 11 days ago. Addressing leaders at a conference hall built by China in Dar es Salaam, he said trade between China and Africa topped $200bn (£130bn) last year.
Mr Xi and his Tanzanian counterpart Jakaya Kikwete signed 16 different trade agreements including improvements to Tanzania's hospitals and ports, and the building of a Chinese cultural centre. The Chinese leader is expected to arrive in South Africa on Tuesday to take part in a summit of the emerging economies, known as Brics (Brazil, Russia, India, China and South Africa).
He will wrap up his African tour with a visit to Congo-Brazzaville.
Outlining China's policy on Africa, Mr Xi pledged to help the continent achieve "independent and sustainable development"
He said Beijing is "not only interested in shipping out raw materials but wants a relationship of equals that would help the country develop", Reuters reports.
China has become one of Africa's major trading partners in recent years, largely based on the trade in mineral products, including oil.