“UNITED STATES OF AFRICA”? Perspective from Reuters…
(REUTERS) – From 2003 to 2008, Africa experienced an unprecedented boom due to a mixture of debt forgiveness, free market reforms and soaring commodity prices that lifted annual output by five percent or more — crucially outpacing population growth. That came to a juddering halt with this year’s global economic slump, but the International Monetary Fund is forecasting African growth at 4.0 percent for 2010, against 1.7 percent for 2009.
If it can sustain this, and consolidate its patchwork of small countries and 30 overlapping trade blocs into a single, huge market, Africa has a chance of unlocking the ‘demographic dividend’ that sucked investment into India and China, dramatically raising productivity, analysts say.
“If that doesn’t work, the demographic dividend is off. It’ll just be a lot of small, unsustainable states competing against each other, as we’ve seen for the last 50 years,” said Patrick Smith, editor of Africa Confidential magazine.
Pan-Africanism, including even a ‘United States of Africa’, has been a rallying cry since the continent started to shake off its colonial shackles in the 1950s and 1960s. The reality, however, has seldom matched the rhetoric as first the polarizing framework of the Cold War and then short-term national self-interest hampered growth in cross-border trade, investment and political cooperation.
Today, intra-regional trade accounts for just 9 percent of Africa’s total commerce, compared to nearly 50 percent for emerging Asia, according to U.N. trade body UNCTAD.
However, there are signs this might be changing, most notably with an agreement last year by three major blocs — the Common Market for Eastern and Southern Africa, the East African Community and the Southern African Development Community — to create a single free trade zone encompassing 530 million people.
Implementation will inevitably hit snags and delays, but at a practical level, everything from more cross-border bus routes to electricity lines and regional ‘power pools’ all point to closer regulatory and political alignment. “It’s not just a political slogan now. There are some actual actions,” said UNCTAD Africa specialist Janvier Nkurunziza.
SOUTH AFRICA SETS THE TONE
Set against this new political will, however, is the sheer scale of the investment needed to address Africa’s problems. The World Bank’s International Finance Corporation estimates that Africa spends only $10 billion a year on upgrading its dilapidated electricity grids — compared to $40 billion needed to meet demand forecast to treble in the next 20 years.
Similarly, sub-Saharan Africa needs to invest $11 billion a year in farming to feed the extra mouths in 2050, the U.N.’s Food and Agriculture Organization said this month. And even if they secure the cash, leaders need only look at relatively wealthy South Africa, where millions of blacks still live — and frequently riot — in shanty towns 15 years after the end of apartheid, to realize that rolling out infrastructure on a grand scale is far from simple.
The Billionth African, Reuters