As we come close to the start of a new decade in a new era of industrialisation based on a digital economy, artificial intelligence (AI), robotics and bringing economies closer through an integrated hard and cyber infrastructure, Africa’s future depends on how well it is prepared to embrace the changes, shifting its economic policies toward e-commerce, absorbing new technologies, and linking its local markets to the global one.
African macroeconomic indicators are all veering towards a looming slow growth and recession.
The reasons for the economic slowdown is of course linked to a certain extent to the global scepticism due to the waging trade wars that the US administration is pushing forward, though the real driver Africa’s recession is poor economic policies, & a lack of infrastructure to support innovation and integration into the regional and global market place.
To put it bluntly, Africa suffers from an infrastructure deficit. Goods and people cannot move freely and reach potential markets.
To cater to the 12 million annual new job seekers, Africa needs to re-evaluate its macro level policies with regard to industrialisation. Key sectors such as power, water and transport services prove a comparative advantage.
There can be no economic integration in Africa, and no inclusive growth without infrastructure. It has been proven scientifically that good infrastructure and productivity costs reduction help move goods smoothly at a low cost between markets.
African policymakers need to change their approach to deal with their economic foes. Alternatives are needed to speed up their infrastructure’s needs, adhere to a new global initiative that can not only answer their immediate concerns but also help them make the jump to the 21st century’s industrial revolution.
Supporting a physical brick and mortar marketplace will reduce unemployment, develop digital economy and spur entrepreneurship. Countries today must help spur opportunities for wealth and employment.
Africa is unfortunately having what we call in business a market and policy myopia, meaning it cannot see past its colonial economic order.
In 1949, China had almost a non-existent infrastructure. Today, China is the second largest economy in the world, with a state of the art infrastructure that reflects a modern nation with an eye on the fifth industrial revolution.
Of course, China has supported Africa’s development needs since 1949. China has offered the world and Africa a new alternative in infrastructure development, notably in the Belt & Road Initiative (BRI).
Through the BRI and the Asian Infrastructure and Investment Bank (AIIB), Africa now has access to financial, technical, and market support with no restrictions or demands that put pressure on the sovereign right of countries participating in the BRI.
And the BRI not only can grow, but also integrate Africa’s regional economies and connect them to countries signatory of the initiative. There are economic opportunities in South Asia, the Middle East, Africa and Europe.
China not only will support Africa’s infrastructure, but will also build its communication network through its fifth generation innovative technology.
Unfortunately, only 27 percent of the Africans have access to the internet. With no mobile banking and a limited opportunity for online transactions, African youths have a limited chance to become familiar with cyberspace.
Huawei and ZTE have helped build the digital foundation for major economic players on the continent. Citizens are enjoying high-speed internet, learning the know how in key technologies and creating training centres to maintain and improve an internet infrastructure through local players. China is ready to help out more upon African policymaker’s needs.
Africa is facing economic and social challenges and the needed infrastructure to integrate a digital economy requires rethinking its macroeconomic policies.
The BRICS, the BRI, the AIIB are all sound alternatives because they emerge from developing nations and have faced the same problems as Africa during the second half of the 20th century.
However, they managed to create the momentum to escape the label of being regarded as underdeveloped nations, and need to eradicate poverty, as well as create inclusive growth on a global scale that has never been reached before.