Africa’s Middle Class Will Be the Story of the 21st Century
WHY YOU SHOULD CARE
Because the rise of Africa’s middle class could be the story of the 21st century. That is, if it happens.
By OZY Editors
The word “Casablanca” evokes ancient souks and bazaars, maybe Rick’s Café Américain — not so much “modern financial hub.” Yet, Morocco’s bustling commercial capital is becoming just that. And now, this centuries-old desert kingdom is positioning itself as the Western gateway to Africa’s fast-emerging markets. With the potential to connect its own Western-friendly business climate with a growing commercial footprint south of the Sahara, Morocco’s got a pretty strong pitch. Already an important economic hub on the African continent, Morocco is preparing to go global. And it’s way more than camels and casbahs. Read the story here.
In less that 50 years, Africa’s middle class is expected to exceed 1 billion. European and Asian investors seem to understand this — China’s trade with Africa hit $170 billion last year — but the United States doesn’t. Until recently, it didn’t seem the Obama administration understood either; President Obama’s African agenda was basically nil. But that’s changing, if belatedly. Earlier this month, the administration hosted the U.S.-Africa Leaders Summit, an unprecedented and, at times, ostentatious gathering of nearly 50 African heads of state, African and American CEOs, and civil society leaders. Will the summit convince investors and diplomats that Africa needs “trade not aid”? Read more here.
Chris Folayan is the 37-year-old CEO and founder of Africa’s largest mall, which, yes, happens to be online. Its 140,000 members — in Nigeria and, soon, Ghana, Kenya and Tanzania — use the platform to buy stuff from U.S. and U.K. sites that don’t do business with the continent. Some of them have been known to drop $25,000 a day. It’s debatable whether a platform for luxury consumption — from Western firms, no less — adds much to Africa’s economy. But Folayan, a Nigerian who’s spent a lot of time in Silicon Valley, says the obstacles are overestimated and that Western companies don’t understand there’s “a huge, untapped market full of customers who want to buy Ralph Lauren T-shirts and Nordstrom watches, but just can’t get them delivered.” Read more here.
By the books, the continent is rising. Africa had six of the world’s 10 fastest-growing economies in the 2000s. Minerals, metals and oil are nourishing long-starved government coffers. In January, Kenya’s Revenue Authority said it had collected too much money in taxes over the previous six months — 24 percent more than during the same period the year before. But don’t go telling your friends Africa is no longer poor. The raw numbers are misleading, and “much of Africa’s celebrated growth is vulnerable,” according to the first African Transformation Report. To be sure, steady, single-digit GDP growth beats a shrinking economy — which many African nations have experienced over the past half-century. But while no index yields a perfect measure, the Transformation Index and a few other alternate indexes show that Africa needs more than simple GDP expansion. Read the story here.
Earlier literature on China’s rise in Africa pushed us toward the easy — and flawed — paradigm of China as Africa’s latest “colonizer.” But in his forthcoming book, China’s Second Continent, Howard French argues that the Chinese who migrate to Africa do so as individuals motivated by simple, familiar dreams of opportunity. A former China bureau chief for The New York Times and a veteran African correspondent, French traveled the African continent, speaking Mandarin with Chinese men and women who had grown weary of the daily grind in their homeland. The characters French encounters are risk takers: sometimes foulmouthed, often lucky and universally ambitious. Check out the interview. Read the story here.
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