Resurgent Africa

Banji Oyelaran-Oyeyinka

Description

A study of structural change dynamics in Africa

‘Resurgent Africa: Structural Transformation in Sustainable Development’ is a study of structural change dynamics in Africa and its effect on job creation, living standards and the efficiency of productive cities through manufacturing productivity growth that benefit the majority. Empirical data from selected African countries, including Nigeria, Ghana, South Africa, Kenya, Rwanda and Ethiopia, provides in-depth analysis and knowledge of the continent’s diversified economies by establishing relationships between industrialization trends; rates of urbanization; and urban living standards, income growth and employment in Africa. The findings reveal unconventional pathways of structural change, patterns of jobless growth suggesting economic growth that does not necessarily lead to employment, dominance of services at the expense of manufacturing industry explaining the regress in Africa’s industrial sector and occurrence of structural transformation without improvement in labour productivity. These are important concerns for Africa’s long-term development leading to the conclusion that sustainable urbanization and industrialization are not only closely connected but also key drivers of economic change. The book includes recommendations for policymakers to adopt a new approach to development for a resurgent Africa.

1. Understanding the Pathways of Africa’s Diversified Economies; 2. Growth Pathway: Skipping the Industrial Phase in Africa; 3. Losing the Urban Advantage; 4. Industrialization and Urban Living Standards; 5. Growth and Employment in Africa; 6. Industrialization and Urban Living Standards in Africa; 7. Mapping Africa’s Growth Pathways; Index.

Sujets

• POLITICAL SCIENCE
• Public policy
• Economic development
• Economic growth
• Political economy
• Development

Informations

• Publié par: Anthem Press
• Date de parution: 31 mars 2020
• Nombre de lectures: 1
• EAN13: 9781785273469
• Langue: English

Extrait

Resurgent Africa
Resurgent Africa
Structural Transformation in Sustainable Development
Banji Oyelaran-Oyeyinka
Anthem Press
An imprint of Wimbledon Publishing Company
www.anthempress.com
This edition first published in UK and USA 2020
by ANTHEM PRESS
75–76 Blackfriars Road, London SE1 8HA, UK
or PO Box 9779, London SW19 7ZG, UK
and
244 Madison Ave #116, New York, NY 10016, USA
Copyright © Banji Oyelaran-Oyeyinka 2020
The author asserts the moral right to be identified as the author of this work.
All rights reserved. Without limiting the rights under copyright reserved above, no part of this publication may be reproduced, stored or introduced into a retrieval system, or transmitted, in any form or by any means (electronic, mechanical, photocopying, recording or otherwise), without the prior written permission of both the copyright owner and the above publisher of this book.
British Library Cataloguing-in-Publication Data
A catalogue record for this book is available from the British Library.
ISBN-13: 978-1-78527-344-5 (Hbk)
ISBN-10: 1-78527-344-2 (Hbk)
This title is also available as an e-book.
Contents
List of Illustrations
Foreword
Preface
Abbreviations
Introduction
1. Understanding the Pathways of Africa’s Economies
1.1 Introduction
1.2 Oil- and Mineral-Dependent Economies
1.3 Agriculture- and Resource-Dependent Economies
1.4 State of Economic Diversification in Selected African States
1.5 Summing Up
2. Growth Pathway: Skipping the Industrial Phase in Africa
2.1 Introduction
2.2 Structural Transformation
2.3 Putting the Service Cart before the Industrial Horse
2.4 Industrialization Policies in Africa’s Pathways
2.5 Putting Numbers to the Narrative
2.6 Neither Agriculture nor Manufacturing
2.7 Summing Up
3. Losing the Urban Advantage
3.1 Introduction
3.2 Urban Opportunities and Challenges
3.3 Seizing the Urban Advantage in Africa
3.4 Putting Numbers to the Narrative
3.5 Summing Up
4. Pathways to Productivity Growth in Africa
4.1 Introduction
4.2 Putting Numbers to the Narrative
4.3 Summing Up
5. Pathway to Employment Creation
5.1 Introduction
5.2 Unemployment and Underemployment in Africa
5.3 Putting Numbers to the Narrative
5.4 Summing Up
6. Pathways of Urban Living Standards
6.1 Introduction
6.2 Putting Numbers to the Narrative
6.3 Statistical and Econometric Analysis
6.4 The Differential Impacts of Growth on the African Urban Consumer
6.5 Summing Up
7. Conclusions and Recommendations: Mapping Africa’s Growth Pathways
7.1 Introduction
7.2 The Structural Transformation Pathways
7.3 Can a Services-Led Growth Pathway Prosper Africa?
7.4 Making a Case for Industrial Manufacturing in Africa
References
Index
Illustrations
Figures
1.1 Structure of sample economies in 2017
2.1 Comparative analysis of structural change in African countries
2.2 Value-added share in Botswana
2.3 Value-added share in Nigeria
2.4 Value-added share in South Africa
2.5 Value-added share in Tunisia
3.1 Economic growth and urbanization in sub-Saharan Africa
3.2 Human Development Index and degree of urbanization in African countries
3.3 Labor productivity and degree of urbanization in African countries
5.1 Wealth growth in sample countries (set 1)
5.2 Wealth growth in sample countries (set 2)
5.3 Shifts of shares for main economic sectors
5.4 Shifts in agriculture, manufacturing and services employment
6.1 Labor productivity and urbanization
6.2 Urbanization and living standards
Tables
3.1 Degree of Urbanization and Living Standards
4.1 Average Decomposition of Labor Productivity Growth from 1991 to 2013
5.1 Shift of Value-Added Share in Mining, Utilities and Construction
5.2 Change in Employment Share: Mining, Utilities and Construction
6.1 Urbanization and Structural Transformation in Ethiopia
6.2 Urbanization and Structural Transformation in Ghana
6.3 Urbanization and Structural Transformation in Morocco
6.4 Urbanization and Structural Transformation in Senegal
6.5 Urbanization and Structural Transformation in Zambia
6.6 Comparative Statistics
Foreword
This book makes very important contributions to the discourse of an important theoretical concept: the notion of structural transformation. It uses a rich data set and sound theoretical framing to explain the variety of ways in which structural transformation relates to employment, industrialization, productivity growth, urbanization and poverty reduction. It enriches the debate on how societies are transformed from agrarian economic structures to modern industrial structures, and more significantly the attainment of sustainable social and economic development.
Another important set of analytical findings coming out of this book is the establishment of an explicit relationship between the manufacturing capacities of nations and the eventual transition to high-value services. While the emergent Fourth Industrial Revolution seems to be blurring the boundaries of the three key sectors, namely, agriculture, industry and services, the author demonstrates the inevitable acquisition of manufacturing capacity as a necessary condition for sustainable structural transformation. Clearly, the rate of growth of manufacturing and value added does not just undergird economic growth; it is a strong prerequisite for mastering industrial agriculture and services sectors.
The book shows that while both agriculture and manufacturing value added (MVA) and exports are important drivers of real economic growth, Africa’s participation in the global market of manufactures is negligible when compared to other developing countries. Its contribution to continental gross domestic product (GDP), which stands at 11 percent, represents lower ratios than those of other developing regions such as East Asia and Pacific (23 percent of GDP) or South Asia (16 percent of GDP) (African Economic Outlook, 2017 ).
Not surprisingly, the impact of MVA on real economic growth has been weaker than that of services in Africa. In other words, not only has industrialization not taken a firm root in the region, but sub-Saharan Africa has also been skipping the manufacturing phase of development. The central message of this book is that Africa is unlikely to witness shared and inclusive economic growth and development without industrialization.
Fortunately, over the last decade, industrialization has been back on Africa’s economic policy agenda. The leadership of the region understands the imperative of industrialization, with at least half of African countries having put industrialization policies in place. What these countries seem to understand is that for as long as they lack industrial capabilities, there will be no breaking away from the dependency on commodities.
The broad regional agenda to achieving Africa’s development goals include the African Union’s (AU’s) Vision 2063 Goal of “A Prosperous Africa Based on Inclusive Growth and Sustainable Development,” which recognizes industrialization at the driving force, and NEPAD’s “ Industrialization , Science, Technology and Innovation” as one of its four main work streams. Notably, industrialization features prominently in the African Union Commission’s (AUC’s) First 10-Year Implementation Plan (2014–23).
In other words, despite the difficulties encountered in promoting industrialization, these renewed articulation of industrial policies indicate that confidence in the manufacturing sector as an engine of growth remains, and we must therefore continue to support African countries to implement industrial policies.
For example, the African Development Bank (AfDB) Group’s Industrialize Africa High Five (H5) strategy sets out a clear and robust path to promote diversification and industrial development of African economies through investment in transformative flagship programs, supportive policy, institutions, infrastructure, access to markets and capital, competitive talents, capabilities and entrepreneurship.
Under the Industrialize Africa High 5 priority, the AfDB is working with our development partners to support industrial enterprises of all sizes to promote productivity along international value chains. The Bank has invested in high-value industrial projects that promote manufacturing; for example, between 2016 and 2018 the total average approvals for Industrialize Africa were valued at US$2.34 billion. In 2018, 1.2 million people benefited from investee projects (of which half were women). Additionally, we catalyzed funding into private sector industrial projects valued at US$357 million in Nigeria, Guinea and Mauritania, among others.
The Bank also supported private equity funds in manufacturing to invest and build capacity of African small- and medium-sized enterprises (SMEs): It channeled long-term innovative finance and technical assistance to African banks in order to boost lending to transformative sectors, particularly SMEs. This includes US$450 million to trade financing, directly linked to industrialization, and enabled 154,000 owner-operators and micro, small and medium enterprises (MSMEs) to benefit from access to financial services (81 percent of beneficiaries were in low-income countries) through various programs.
Institutional funding of approximately