PDF (2.0 MB)

Given these improvements, it is not surprising that Africa’s prospectsare attracting attention. The Economist was not the first to noticethis. At its 2010 Summit in Seoul, the G20 underscored Africa’sgreat potential to become a destination for investment and sourceof global growth while global research firms led by McKinsey havealso released equally compelling reports on Africa’s prospects. Beforeturning to specific areas in which Japan and Africa can cooperateto mutual advantage, let me first address the question of whetherindeed the current growth cycle in Africa is sustainable.For a number of reasons, I would answer this question in the affirmative.First is that it is Africans themselves that are mostly driving theprocess of growth and investment in the continent. This is happeningthrough demonstrable commitment to promoting regional integrationbecause while the size of the entire African economy wasabout $1.6 trillion in 2008, its potential is reduced by the fact thatthe continent is made of 54 small, fragmented countries. Realizingthese limitations, African countries have taken steps to acceleratethe pace of regional integration notably through the establishmentof the African Union and Regional Economic Communities.Following the publication of ECA’s fourth Assessing Integration in Africareport on intra-Africa trade produced in partnership with theAfrican Union Commission and the African Development Bank, theAfrican Union will be discussing this theme at its next January Summitwhere it will also explore the possibility of creating a continentalfree trade area by 2015. These efforts are also being complementedby the private sector and individual Africa. To exemplify, investmentfunds raised by private equity funds within the continent increasedby 37% from $2.3 billion in 2007 to $3.2 billion in 2008. Similarly,remittances from the African Diaspora were estimated to be about$40 billion last year alone and accounted for up to 9.3% of GDP in acountry like Uganda.It is undeniable that high demand for Africa’s commodities especiallyfrom the emerging economies has contributed to recent growthperformance. However, high commodity prices are only part of thestory and probably accounts for just one third of recent growth asnearly all sectors have contributed to Africa’s improved economicperformance including sectors benefiting from rising disposable incomesuch as telecommunications, construction, agriculture, finance170 Part Three