africa

Yale Center for the Study of Globalization
services. These changes would create stable and productive employment and lead
to a more equitable distribution of income. While a few African countries such as
Mauritius, Morocco, South Africa, and Tunisia have experienced notable economic
diversification, informal and vulnerable employment as well as high youth unemployment
remain formidable challenges across the continent.
A main factor in the inability of Africa’s growth to spread across sectors and populations
has been the dependence of many economies on natural resources. About
25 percent of Africa’s growth has come from commodity sectors, which have also
fuelled an export boom and filled the coffers of foreign and domestic extracting
firms as well as national governments. Africa’s commodity exports are mainly of
resources in their primary form, taken from the earth and sold with little subsequent
processing, refining, or beneficiation taking place within Africa. Agricultural activities,
the source of employment for a majority of Africans, similarly take place with
limited agro-processing or value addition. While contributing significantly to GDP,
mining and fuel extraction have not created jobs commensurate with the revenues
that they generate. This resource dependence has exposed many African countries
to commodity price fluctuations and growth volatility as well as social tension and
political instability.
However, with good policies, African countries have more opportunity today than ever
before to increase and sustain growth and achieve structural transformation. Given
the need to create decent jobs for Africa’s rapidly growing population, the test for
African policymakers and stakeholders will be to ensure that natural resources help
transform high growth into sustainable and inclusive development for the continent,
by fostering new industries that add value to current commodity endowments, and
that branch into new labor-intensive modern manufacturing sectors. Africa should
focus on high growth-potential activities within and across sectors, in order to foster
industrialization and transformation in the current global context.
22.2 Natural resources: endowments, opportunities, and risks
22.2.1 What are Africa’s resource endowments?
That Africa is endowed with natural resources in general is well known, but it is
important to note which countries are resource-rich and which types of commodi-
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