Not much? Then you will find it interesting to listen to this short video where the renowned economist Ngozi Okonjo-Iweala, Nigeria’s finance minister, explains how to keep their high growth and make it sustainable:
Addressing fields such as technology, agriculture and infrastructure is fundamental to achieving sustainable growth not only in Africa but the developing world as a whole. To some extent it actually applies to the West as well.
What’s driving growth in Nigeria?
Nigeria has a two track story, according to Ngozi Okonjo-Iweala. The least familiar track is the one of opportunity that exists because Nigeria has grown at a rate of 7% per year during the last decade. It’s the largest economy in Africa and likely to continue to grow about 6% per annum.
Rising middle class
With their middle class gradually burgeoning and numbers of skilled workers constantly increasing not only Nigeria, but Africa, is turning into a vast and growing market for the world’s manufactured products, intermediate goods and services. Or as the minister puts it “an opportunity of growth driven by internal consumption”.
The growing middle class makes Africa less dependent on the oil anand mineral sectors and puts emphasis on services, manufacturing and agriculture, which will contribute to sustainable economic development.
UN figures actually show that investments in Africa often provide higher rates of return than anywhere else in the world. A new breed of leaders are also emerging on the continent that are realizing that Africa needs to take charge of her own development and destiny. They are determined to break the vicious cycle of political instability, corruption, poverty and underdevelopment. Success stories in Africa are seldom reported. In fact the image of the continent in Western media is negative since positive developments are mostly ignored. And the same applies to African media. Former Mozambiquan president Joaquim Chissano told me in 2004 that the negative focus of African media is contributing to the gloomy image Africa has in the rest of the world.
Creating jobs and equality priorities
Ngozi Okonjo-Iweala is, however, of the opinion that the quality of growth they have had so far needs to radically improve because it has resulted in rising inequality which is not a sustainable situation. Creating a lot of new jobs is, accoring to her, crucial. In her opinion that can be achieved by primarily focusing on agriculture and infrastructure, mainly housing. Apart from that she believes that Nigeria needs to construct a social safety net to alleviate the plight of those at the bottom of the ladder who sometimes don’t even have the skills needed to get a job.
Did you know that Nigeria is growing 7% per annum? Were you aware of how fast the middle class is increasing on the continent? Have you ever thought about exporting or investing there to cater to their needs? Did you know that return on investments in Africa is often higher than anywhere else in the world? Would you like Swedish clothing giant H&M be interested in moving manufacturing to Africa? Do you believe Nigeria’s high growth rate will continue?
Video: McKinsey & Company – Picture: Government ZA