africa

Yale Center for the Study of Globalization
munications at 10 percent, and manufacturing at 9 percent. When decomposed into
five-year periods from 1960 to 2009, private consumption accounts for between 60
and 70 percent of GDP (ECA and AUC, 2014).
Investment has been a key driver of growth in African countries since Independence,
but its scale has increased significantly over the past decade. Indeed, “as of 2007,
the continent had the highest rate of returns on inward foreign direct investment
(FDI) in the world” (McKinsey Global Institute, 2010: 17). However, despite this
improving picture, much FDI still flows to low-productivity but high-return extractive
sectors, and African countries still save and invest too little of their GDP (Commission
on Growth and Development, 2008).
22.3.4 Human development and demographic trends
Africa’s progress in addressing human development goals is also notable as an
enabler for industrialization and transformation, because a healthier and better
educated society is necessary to undertake new and more advanced economic
activities. The continent has made strides in reducing under-five and maternal
mortality and the incidence and prevalence of HIV, and has achieved near-universal
primary education and a significant expansion of secondary education. Population
growth and increasing rural-to-urban migration have led to greater urbanization and
a construction boom.
Africa’s prospects for growth are brightened by its growing workforce; the working-age
population is expected to reach 1.1 billion by 2040. Furthermore, increasing urbanization
is bringing entrepreneurs together in urban knowledge networks. Whether
the growing young population translates into a demographic dividend will depend on
countries’ ability to continue expanding and improving education, and providing the
right, purposive, policies and macroeconomic environment for greater job creation.
22.3.5 Intra-African trade and regional integration
Regional markets are important in facilitating industrialization and local production
both within and among African countries, expanding end markets for manufactured
goods, and facilitating the cross-border movement of factors of production. Recent
studies underpin the fact that regional markets provide more learning opportunities
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