Apparently, Africa’s future seems auspicious and even more with a purported estimate of trillion-dollar valuation for its economy.
Africa, the world’s youngest and fastest-urbanizing continent, it has the potential to grow even larger report from McKinsey & Company had estimated that the continent’s business opportunities could be worth $5.6 trillion by the year 2025.
According to the 2016 report, Africa’s consumers and businesses already bring in $4 trillion annually, and is steady growing rapidly. These predicted opportunities could increase across several different industries including agriculture, infrastructure, and the continent’s abundant natural resources.
Though these factors remain valid, a 2019 Goldman Sachs economic research report shares that these economic drivers of “secular acceleration” have only accounted for roughly 30% of Africa’s GDP growth since 2000, stating that they appear to be “deep and structural,” according to the World Economic Forum.
However, the World Economic Forum predicts this can be achieved by “continuing to strengthen institutions, support political stability, promote democratization, enhance policy coordination, improve ease of doing business, reduce debt, open financial markets, attract foreign direct investment, facilitate technology transfers, and nurture human capital.”
East African countries are already demonstrating the success behind this level of growth, so if continued the entire continent could see positive results over the next half-century and quite possibly surpass China’s rapid rise of the past 50 years.
However, this goal is not without challenges from Africa’s history of slavery, colonialism, and power trips that could threaten its ability to overcome and turn over a new leaf.
Moreover, concerns remain around the global economic landscape, mostly in regards to trade tensions between the U.S. and China as well as the effects on growth and commodity prices.
Africa’s ability to reach new growth heights is dependent on its largest economies; Egypt, Nigeria, and South Africa. However, if it should succeed, the end results could remove millions of its own from poverty, and position the continent as a stable and flourishing economic partner for the rest of the world.
