Africa is poised for economic growth. According to a McKinsey Report, the number of African households with discretionary income will increase to 128 million by 2020, making Africa one of the fastest-growing consumer markets of this decade. 60% of the world’s uncultivated arable land is in Africa and with growing demand for food, all roads seem to point to Africa as the bread-basket of the world.
Even though Africa presents a story of great promise and potential, the challenge of growth and development is still as relevant and as urgent as it was four decades ago. Sub-Saharan Africa’s GDP per capita today stands at a miserly $700 compared to $28,000 in advanced economies. In other words, the average American is 40 times richer than the average African. This economic underperformance has real consequences on the lives of many on the continent. Half of Sub-Saharan Africa survives on less than $1 a day, 33% of the population suffers from malnutrition, and the average life expectancy is 54 years. Several African countries are still encumbered by conflicts, ailing institutions and stagnant or erratic growth.
The Africa Growth Lab worked to identify the most important constraints on African growth and to recommend interventions that can relax these constraints.
Our researched covered four thematic areas:
- Productivity and Economic Growth
- Innovations in Financial Services
We gratefully acknowledge the generous support of Standard Bank whose gift has been instrumental in seeding this phase of growth research to accelerate the pace of discovery – and application – of emerging theories of growth for African economies.