After years of economic stagnation, many nations in Africa are entering the 21st century with new-found optimism. This is derived from some impressive economic activity over the past ten years, and here are five emerging African economies that are set to make a serious claim on the global financial stage.
The Rainbow Nation is key to much of Africa’s recent success. South Africa now accounts for 24% of Africa’s GDP thanks to investment in traditional industries such as agriculture, manufacturing and mining. But it is the phenomenal growth in the tertiary sector that has shaken up the economy as the country’s tourism and business service economy now make up a healthy 65% of the GDP.
The growth of this sector can be seen in a myriad of industries from software developers like Snapscan that have introduced an app that allows an efficient way of making digital payments, to Springbok Casino who have capitalized on a growing global trend for online gaming with a range of accessible and enticing casino games.
With the recent election triumph of Muhammadu Buhari, Nigeria has seen a wave of positivity that looks to maintain its position as the continent’s largest economy.
Prior to the election result, Nigeria’s market had been suffering from uncertainty over the change of leadership along with military difficulties with the Islamist Boko Haram. However, with the capital market making its biggest gain of the year with an 8.30% rise after the election result, the country looks to be back on course to develop its highly profitable markets in oil, agriculture and emerging markets of communications and financial services.
One country that has seen impressive government initiatives to boost its economy is Ethiopia. The country managed an incredible 10.6% of GDP growth between 2013 and 2014, and key to this is a five year transformational plan that aims to install Ethiopia as a major manufacturing hub in the region with industries such as agricultural processing and textiles giving the country a much needed boost.
Another country that has shaken off historical difficulties is Rwanda. This nation gained a 7.9% GDP growth rate between 2013 and 2014 and the economic ratings company Fitch recently awarded Rwanda a ‘B’ status in praise of its ‘solid economic policies, a track record of structural reforms, macroeconomic stability, and low government debt’. However, it has been noted that the nation still suffers from an embarrassingly high rate of poverty signalling that there is much to be done before Rwanda can truly compete on a global scale.
And finally, Kenya has recently been praised as being the continent’s economic powerhouse. This is thanks to political stability, along with positive investment and efforts made to improve the country’s infrastructure through a diversified economic base. Now a variety of businesses are being allowed to flourish in traditional industries such as agriculture, as well as in the arena of technological innovation that has led to the rise of the so-called ‘Silicon Savannah’ with a major techno-city being built in Konza.
Sources: snapscan.co.za / uneca.org /nytimes.com