All the signs are there: Africa is the new East Asia

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All the signs are there: Africa is the new East Asia

It is sometimes easy to forget the journey that East Asia has been over the past century. The case of Sony, the Japanese electronics firm, is illustrative. Sony was founded by Akio Morita in Tokyo in 1946[i]. Having survived its early years, chiefly through loans from Morita’s father and carrying out radio repairs[ii], Sony then had to contend with outside perceptions that Japanese products were ‘shoddy.’[iii] And yet, somehow, Sony went on to become a giant of global electronics and a by-word for high quality.

 

Thankfully, Sony’s story is not unique in East Asia. Several countries once considered backwaters in many respects, are home not just to world-leading companies but to hugely improved living standards. But there was little suggestion that any of this would have happened at the beginning of the 20th century. As we move away from the beginning of the 21st century, Africa is well placed to replicate the East Asian story if it can leverage certain strengths that it possesses.

 

Too often essays on the future of Africa discuss what Africa should do. Despite centuries of European interference which have held the continent back, many European onlookers bizarrely still feel it right on some level to give Africa friendly advice. I try to avoid that in this essay. Instead, I want to look at five strengths that I believe Africa can and will leverage so that one hundred years from now, Africa’s narrative will mirror that of East Asia’s. These strengths are: demographics, outsiders’ perceptions, telecommunications, trade and governance.

 

Demographics

Changing demography is arguably the great economic driver after technological advancement. In a 2008 Harvard Paper by David Bloom and Jocelyn Finlay,[iv] the authors state, ‘the economic performance of East Asia was no miracle at all, and to a large part was explained by demographic factors.’ These demographic factors, as the authors point out, involved a rise in the working age share as well as female workforce participation as a result of a decline in the fertility rate. Right now, a similar dynamic is occurring with demographics in Africa. Since the beginning of this century, fertility rates and child mortality rates have been declining[v]. This creates a ‘demographic dividend’ which Africa is set to take advantage of just as China did in the 20th century.

 

 

 

 

Outsiders’ Perceptions

The perceptions of outsiders have long held back Africa. These perceptions are perpetuated by the media and general ignorance. An example is provided by as venerable a publication as the Economist. It often pithily refers to Africa as ‘the dark continent.’[vi][vii] Such remarks aren’t helpful but they’re unlikely to be the worst made by the media. The net effect is that Africa is paying what amounts to a development premium not dissimilar to that experience by Sony with its ‘made in Japan’ labels stunting its progress. For example, by one estimate,[viii] only about 0.3% of the average US portfolio is invested in Africa. Even taking into account Africa’s issues, by these numbers, it is highly underweighted in the average US portfolio. Once these perceptions shift, Africa will reap the benefits everywhere and the ‘dark continent’ label will be seen for what it really is: a relic of a distasteful past.

 

Telecommunications

Africa’s telecommunications sector offers an encouraging sign that entrepreneurialism is alive and well on the continent. Much has been made of how mobile payments have taken off in Africa in the past ten years. As of late 2014, it was thought that there were more mobile payment accounts than traditional bank accounts in upward of nine African countries[ix]. In a century where telecommunications are already playing such a huge role in trade and commerce, this integration of mobile technology into sectors where more economically developed countries are lagging behind already seems significant. Africa is a pioneer in telecommunications. If it continues along this path, the 21st century will be a century of opportunities. E-learning and e-commerce are now accessible on the average African’s mobile phone, when twenty years ago, there were a range of barriers to achieving education or international trade. Even Africa’s greatest critics would find it hard to deny that this shift alone can bring with it a wave of progress to Africa.

 

Health

Health statistics for Africa make for depressing reading. Of the 20 countries with the highest child mortality rates in the world, 19 are African[x]. The continent still has unacceptably high rates of HIV/AIDS and malaria, among other diseases. Progress is being made, with one WTO Report outlining that every one of their health indicators improved between 2005 and 2012[xi]. The fact that the issue of health on the continent has been taken on board by as visible a figurehead as Bill Gates is a huge turning point, which is sometimes lost in the noise. To give this context, if John D. Rockefeller had taken on the task of dealing with health in Africa at the beginning of the 20th century, where would it be now? If you’re thinking, as I am, that the answer to that question is ‘in a much better place,’ then there is serious hope that Africa’s health will be much less of an issue down the road than it currently is.

 

Governance

Governance will tie all of Africa’s strengths together. The straight lines that divide countries in Africa tell of a continent whose boundaries were drawn up by colonial masters, most of whom left just over fifty years ago. We cannot impatiently expect African nations to become models of good governance in so relatively short a period. It seems Africa is somehow held to higher standards. For example, between 2008 and 2012, Japan elected five separate Prime Ministers[xii] (six, if you include Shinzo Abe’s two terms): hardly the stuff stability is built on. One can only imagine the clamour if the same thing happened anywhere in Africa.

Good governance is emerging in Africa but patience is needed. In 2015, Nigeria passed political power from one party to another for the first time in decades.[xiii] This occurred 55 years after Nigeria’s independence. This is right on schedule. To draw a parallel, South Korea still had a military dictatorship in 1993, 45 years after establishing independence. Africa is not inherently corrupt – it is coming out of a torrid colonial period and its governance has reflected that until now. There is every hope that the coming years will bring huge advances in this area for Africa and its citizens.

 

Conclusions

In researching for this article, I was overwhelmed by the amount of negative commentary surrounding Africa. It’s hard to escape the impression that many people have written off Africa on the basis of past failures. What this fails to recognize is that many of Africa’s past failures occurred as a result of direct foreign intervention of some form or another. Furthermore, it points to how people forget that, in many regards, at the beginning of the last century, East Asia was in a relatively similar position to the one that Africa finds itself in today.

The East Asian ‘miracle’ wasn’t really a miracle at all. It was due to a number of factors coming together to create an unparalleled century of growth for the countries in question. It didn’t happen overnight and it didn’t happen without several hiccups along the way. This will also be true of Africa’s progress. We also have to bear in mind that in talking of East Asia, we’re talking about eight countries; with Africa, that number is 54. While each of these countries has its own complexities, the tendency is to group them together – something this essay is also unfortunately guilty of.

Right now, there are would-be Akio Morita’s all over Africa, trying to make things happen but face obstacles in the form of everything from government restrictions to our slowly-changing perceptions of them; there are others just like them who have survived the African child mortality lottery and will soon swell their ranks; and there are others still, yet to be born, who will make up the numbers of Africa’s coming demographic boom, in turn creating a huge market of willing workers and customers. If this all sounds very familiar, it’s because something very similar happened in South East Asia at the beginning of the last century.