African economies flower

Six of world’s 10 fastest-growing nations, fuelled by commodities and new business

The shops are stacked six feet high with goods, the streets outside are jammed with customers and salespeople are sweating profusely under the onslaught.

But this is not a main street during the Christmas-shopping season in the rich world. It is the Onitsha market in southern Nigeria, every day of the year. Many call it the world’s biggest. Up to three million people go there daily to buy rice and soap, computers and construction equipment. It is a hub for traders from the Gulf of Guinea, a region blighted by corruption, piracy, poverty and disease but also home to millions of highly motivated entrepreneurs and increasingly prosperous consumers.

Over the past decade, six of the world’s 10 fastest-growing countries were African. In eight of the past 10 years, Africa has grown faster than East Asia, including Japan. Even allowing for the knock-on effect of the Northern Hemisphere’s slowdown, the International Monetary Fund expects Africa to grow by six per cent this year and nearly six per cent in 2012, about the same as Asia.

The commodities boom is partly responsible. In 2000-08, about a quarter of Africa’s growth came from higher revenues from natural resources. Favourable demography is another cause. With fertility rates crashing in Asia and Latin America, half of the increase in population over the next 40 years will be in Africa. But the growth also has a lot to do with the manufacturing and service economies that African countries are beginning to develop. The big question is whether Africa can keep that up if demand for commodities drops. read more