Positive medium-term outlook for the continent

Africa is in better shape than
ever before, in the view of senior
Nedbank economist Nicky
Weimar.
“Having managed to survive
the global economic downturn,
it is slowly but surely arriving at
a place where it can exploit its
positive aspects,” says Weimar
who believes that there is a
higher capacity for growth on
the continent than in previous
decades when at times the
continent could best be described
as “dismal”.
“Africa may still not be taking
full advantage of its potential
but it has turned the corner. Its
growth has, for the most part,
tracked what has happened in the
East and there has been improved
trade for Africa. There has
definitely been higher investment
and therefore a higher capacity
for growth.”
But, says Weimar, Africa needs
to overcome some key challenges
before it will really reap the
benefits.
“Policies in Africa are erratic
and this is a big issue. If one can
address this then the rest will all
follow. The fact that policies can
change overnight makes investors
nervous and too many have burnt
their fingers and therefore rather
stay away.”
The other major problem is
African countries’ dependency
on single commodities. “There
is not enough diversity in the
economies and therefore they
are vulnerable to the global
market affecting those one or
two commodities. Corruption
and patronage are problematic
for Africa and health remains a
major inhibitor as people are just
not as productive as they should
or could be.”
Weimar says despite this
the recession did not affect
Africa as badly as some of the
industrialised countries. “Yes,
Africa saw slower growth due
to the recession, but in many
countries they did not even
really see the effect of the global
economic meltdown.”
She says with a renewed focus
on emerging markets Africa is
currently in the ideal position
to use its vast riches to draw
investors and developers. “The
medium term outlook is positive
and Africa is expected to grow.”