The beginning of 2021 has been tumultuous. The insurrection of the US Capitol has put the world on edge as it waits for Joe Biden to return some normalcy to the Presidency.
The Covid pandemic has been turbo boosted by the accelerant of a new mutant variant placing ever greater strain on the health care systems in both advanced and emerging economies. The hope promised by various vaccines has been tempered by the logistical challenges of delivering the injections.
Global stock markets have taken on a life of their own in complete defiance of the most basic fundamentals. Will it end in tears or has the investment industry invented a ‘ new normal.’ Time will tell. But it is a brave man who ventures into the market at these stratospheric valuations.
The tech industry has defied gravity. The pandemic has accelerated the trend towards our technological future.
Where does Africa stand in this maelstrom? Despite being a tiny part of the global economy, less than 5%, it has an interesting future – not least because of its demographic dividend. The African Free Trade agreement augurs well and would be so much more powerful if there was more Intra-African trade – perhaps this will boost that.
Africa needs investment in a number of areas which will have the biggest boost on economic growth. The three top areas I suggest are: agriculture; power (renewable energy) and broadband (and associated infrastructure).
Agriculture is critical as it addresses two key areas – food security and employment. In addition by modernising agricultural practises it will be possible to have an impact on the ravages of climate change especially desertification. The Great Green Wall project on the southern border of the Sahara is such an example.
The absence of reliable utility power is one of Africa’s biggest constraints. Investing in multiple renewable energy projects – especially solar and wind – the costs of which are now lower than fossil fuel – will enable a much needed industrialisation program to add value to the primary products which Africa has provided to the world since colonial times.
The tech revolution in Africa which began with the spread of mobile telephony will take off again with the delivery of affordable broadband to every African. This should be the focus of every mobile operator, ISP, cable operator and data centre company. Access to the Internet in the hands of every African will catalyse education, good governance and healthcare with strong economic growth a key outcome.