africa

Yale Center for the Study of Globalization
percent. Real income per person has also increased—by more than 30 percent in
the last decade. Post-conflict countries posted growth of 6.6 percent while fragile
states grew by 3.6 percent over the same period. There has been improvement in
key welfare indicators as well. Poverty rates are falling, though still high. Between
1999 and 2012, Africa’s average poverty rate fell from 58 percent to 43 percent.
Second, it is incontestable that Africa’s growth is happening with no meaningful
structural transformation. There is no reallocation of resources from low productivity
areas to high productivity areas.
Third, the factors that are driving African growth are well known. Some of these
include increased population growth with attendant increased aggregate demand,
and macroeconomic management that has tremendously improved, compared
to a decade ago, and has largely come with supportive policies for private sector
growth. Instances of political instability have been drastically reduced in the continent.
Political governance and the rule of law have been strengthened and this
has increased economic accountability. Africa has been opening up to international
trade and investment. Natural resources are booming, notably as the result of the
demand for minerals and oil from Asian countries, including China. We also see
greater regional economic integration and improved inflows including of foreign
direct investment and remittances.
2.2 Constraints on growth
But masked in the growth story are what one could call Schumpeterian forces working
behind the scenes and affecting Africa’s growth. First, Africa is starting from a
disadvantaged position on several fronts due to the effects of colonial rule. One of
these is ethnic fragmentation, which started with the colonialists. Recruitment into
the military and civil service by the colonial masters largely followed ethnic leanings,
with those groups who were considered allied to the colonialists given privileged
access to education and administration. This was the case with the Kamba in Kenya,
Tiv in Nigeria, and Acholi in Uganda. Those who were considered less cooperative
were neglected and punished for being unruly and generally left out of government
(Young, 1994). Ethnic fragmentation has continued to haunt Africa to date.
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