Drivers of Economic Growth in Africa: Opportunities, Financing and Capacity Issues
Africa’s economic, social, and political history largely determines its current economic development. The externally imposed structural adjustment programs and reform initiatives of the 1980s and 1990s failed to promote productivity, employment, and poverty reduction. Since 2000, most African countries registered remarkable growth, but this growth failed to reduce inequality. This study provides a detailed discussion of African countries’ growth performance - focusing on economic, social, structural, and political changes. The study underscores the importance of using the continent’s potentials (such as arable land and young population) for its structural transformation. Africa’s growing economic and geopolitical importance gives it the opportunity to make the most of its partnerships - used by many African countries for infrastructure development, technology transfer, trade, and curbing of illicit financial flows. It also gives evidence of various financing sources (such as debt, savings, revenue, and foreign direct investment) and their future projections based on current trends. Information on Africa’s substantial growth determinants and key capacity needs that will contribute to economic growth is highlighted.