Parts of Africa are well on the way to becoming some of the most dynamic places in the world for investment.
In recent years, an encouraging economic environment has spurred high growth rates in many African nations, with:
- Significant reforms in macroeconomic management
- Improved incentives for the private sector
- A broadly favorable international context for commodity exporting countries
While most of the world is facing major economic and political uncertainty, Africa is expected to continue its growth trajectory in the coming years.
With 20% of the world’s land mass and 15% of its population, Africa is being touted as the world’s last major economically untapped region.
Factors driving Africa’s success
In Africa, a broad range of factors have created favorable conditions for economic transformation, which could see rapid growth become sustainable and inclusive in the future.
- Improving macroeconomic indicators and business environment
- Demographic dividend, rising middle class and urbanization
- Growing links with emerging economies
- Private sector participation
- Natural resources
Although Africa’s economy has grown rapidly over the past decade, questions are sometimes raised about the sustainability of this growth. This highlights the need to implement transformation policies that expand the private sector, increase productivity levels and, create quality jobs.
A robust structural transformation is the key to shaping Africa’s ability to generate inclusive growth and tackle serious challenges, such as poverty and unemployment.