The African Dream

Having recently finished an essay on the effects of SAPs (Structural Adjustment Policies) and PRSPs (Poverty Reduction Strategy Papers), It has got me thinking does Africa as a continent, never mind the individual nation states , have a long term genuine future? By this I mean, is Africa just another hotbed for foreign investment (get in, get out culture) or is it a continent that will genuinely challenge global norms which subordinate the continent behind the rich north? Having done my research and in addition to analyzing current trends, I have come to the conclusion that the former is not only a stark reality but is also growing as a "culture" for global investors. "We're not too sure about how Africa will pan out in the next 10 years, but our plan for now is to make use of the investment opportunities currently available", says a private equity investor.

FDI projects grew by 27% in 2011, pushing Africa's share of the world's investment to almost a quarter. FDI inflows, now about $80bn (£50bn), should reach $150bn by 2015, according to global consultants. Furthermore, coupled with Africa's annual GDP growth rate of 7.5% this suggests a future where Africa, as a continent, will establish its place within the global economic system. These figures have been largely due to the various infrastructure projects that China, in particular, has invested so dearly in. Not only has this provided jobs, but it has also alerted TNCs and individuals of the plethora of opportunities currently birthing in Africa.

However, these figures mask the real problems Africa face. In 2010, figures suggested that 40% of Africa's annual GDP was lost to corruption. Not only has this been a long standing problem in Africa since the various military coups of the 1970s and 80s, but it now seem to be endemic of current African governments. Besides hindering growth, this self-centered attitude has left many young African's disillusioned about their continent. On a trip to Kenya in 2010, a common complaint I got from many was that Africa will never go anywhere because "politics is corrupt." This nicely flows onto my second point - many young African's are becoming entrepreneurial and as a result this does not ultimately bode well with their perceived attitudes of politics as corrupt. The effect of this is two-fold. One, increased entrepreneurial spirit will stimulate jobs in the economy, but on the other hand, increased entrepreneurial will mean young entrepreneurs will have to breakdown established prejudices against their own governments.

Africa has a "dream" to be the hub of foreign direct investment, but the hidden cost is that this is coming at the expense home entrepreneurs (in terms of opening the door for TNCs) and is also fuelling the corruption culture. If Africa really wants to achieve this dream, it must try and establish ways of building trust within its borders so home entrepreneurs can forge greater amongst each other which inadvertently secures the long term future of the continent. Though this piece may seem pessimistic about the prospects for Africa, it should be noted I do believe in the current optimism, but it is what I perceive to be a "tinted optimism" - optimism which doesn't quite have a view of the other side looks like.