Another new year, another decade: and as always, it’s a particularly good time for measured reflection on where we’ve been and where we might be going. Especially with Boris Johnson having taken over the helm again in a post-Brexit Britain, 2020 is likely to be a more appropriate year than most from which to cast a colder eye on past mistakes, new opportunities and all those roads less travelled: and that doesn’t just mean post-Christmas remorse over too much turkey and way too much Brexit for any single lifetime, but front and centre for all our futures it does mean Africa.
Widely forecast to deliver 3.5% GDP growth last year, Africa actually came in ahead of target with 4%, which makes it is the fastest-growing region anywhere in the World after Asia: and not only does Africa have more than 400 companies producing more than $1 Billion in goods and services annually, according to the prestigious Brookings Institution these companies are also growing faster than their global counterparts and they’re also a lot more profitable too. Who would have seen that coming?
Kenya (East Africa’s largest economy) is forecast to expand its economy by 5.7% this year and Ghana, the fastest growing economy in the world in 2019, is likely to maintain its leading edge with forecast growth of 6%: both economies fuelled by a burgeoning and increasingly middle class demographic with an increasing appetite for conspicuous consumption and that’s a trend reflected across sub-Saharan Africa, whereby 2030 aggregate household consumption is expected to grow from $1.12 Trillion to $2.47 Trillion.
Within the same ten year period at least 24 of its 54 nations are projected to deliver annual growth of at least 5%, and according to Brookings (again) sub Saharan Africa will see a staggering 600% rise in GDP over the next thirty years: producing goods and services worth $29 Trillion annually. To put that in some perspective, the largest economy in the world at the moment, the United States, is currently producing $21.2 Trillion of goods and services each year so if Brookings is right then within twenty years sub Saharan Africa will be bigger than Donald Trump’s America is now. Perhaps Mr. Trump might wish to be more circumspect in his choice of language…
By 2030 it is also at conceivable (or at least we can hope) that the heat and dust of Brexit will come be recorded as a bump and blip in an over-turbulent decade; maybe a bigger bump and blip than most, but a bump nonetheless. On the other hand, economic developments in Africa have real potential to change the way we look at the world forever.
Growth rates in African economies will also start to accelerate as we go deeper into 2020: at a time when the United Kingdom and the United States are delivering either static (sorry Boris) or at best-mixed growth figures (sorry Donald), most informed commentators are predicting positive growth trends across the board for despite (or possibly because of) a tailing off in international demand and a trade war between the its two biggest economies.
The SLC African Fund aims to build on the opportunities offered by sub-Saharan African Markets and deliver long term capital growth as well as income distribution: working to solve social and environmental challenges and at the same time deliver sustainable profits for investors.
At Red Ribbon we have long been aware of Africa’s potential as a driver for global economic growth, not least across the disparate territories of sub-Saharan Africa itself: so I was especially interested to read the recent report of the Brookings Institution which points the way towards a real tectonic shift in international markets.
I suspect we’ve all become a little too immersed in Brexit over recent years and sometimes that has made it difficult to get a clear picture of what the wider world is doing, but this is a time of great change for Africa and, as the article says, that may well change the way we look at the world forever.