With a population of over one billion people, Africa has the market to take an economy to the highest summit, but having the market alone doesn’t do it – there are vital factors that must be put to work to make any economy reach in practical, its innate potentials. When these factors are constantly activated, the economy will self-propel in an upward direction. A driven economy doesn’t work by magic or through the unproven hypothesis of the big bang theory – it works through the positive actions of all stakeholders – if everyone involved does what they should do and avoid what they should avoid, things will be fine.
To grow an economy, you must first, earnestly, honestly and sincerely know where you stand. It’s only by knowing where you stand that you can measure your growth or determine if there’s growth at all – by this, you can also determine when there’s a backward trend and where the retrogression occurred. One major problem with driving the African economy is a lack of realisation of the unquantifiable influence and relevance of statistics. We have not, even till date, given data capture, processing, analysis, and utilisation its due place. And because of that, our economic scorecards are not respected by the outside world. In 2014, the Nigerian economy overtook that of South Africa by becoming Africa’s largest economy. But this should have happened years before – the delay was due to statistical ignorance, negligence or indolence. The United Nations Statistical Commission had recommended a statistical rebasing every five years, but this wasn’t adhered to by Nigeria – and when it was, according to the UK Guardian newspaper, $240bn was added to the Nigerian economy (2013 figures) which was equivalent to finding six Ghanas within Nigeria. Understanding the importance of statistics in economic growth is overwhelmingly relevant.
If you look at any economy, amongst the top of the table of sectors of industries who grow it are the small and medium scale enterprises (SMEs). Any government that genuinely wants to grow her economy must not formulate policies that either kill or limit the growth of SMEs. Instead, policies that encourage more people to own and run their businesses should be constantly synthesised and appealingly enforced because SMEs are the main catalysts of productive economies.
Formulation, implementation and effecting good and workable tax policies is one of the driving factors of growing a viable economy. I think sub-Saharan Africa has not, in all determination, taken taxation as a major catalyst for economic growth. The ineffectiveness and loopholes in our taxation policies have been taken undue advantage of by both indigenous and foreign businesses – many of these organisations don’t pay close to what they should pay, and that unpatriotic action is stiffening the African economy. In Europe, to be specific, the biggest source of government revenue comes from taxes, and these monies go back into national development. Imagine the level of cash that will be generated if proper tax policies are implemented by African leaders!
A nation whose economy is only raw-materials-based can’t grow much – if you can’t process it, you can’t make much from it – this is applicable to all aspects of life. Nigeria has crude oil but doesn’t process – what they make from selling crude things is far incomparable to what those that process it makes. The most annoying thing is that advancement in technology has made processing a lot easier, simpler, sizeable and manageable, but ignorance, insensitivity, corruption and detrimental partisanship have blinded the minds of most leaders from seeing what is reachable and achievable, and for that, economies either go in snail’s speed or become stagnated.
Every economy is catalysed by investments – both local and foreign. Investments create jobs, and from the jobs created, taxes are paid, and because people have money in their pockets, they patronise small and big businesses, which in turn boost the economy. Every sane government should worry when investors aren’t coming forward to make enquiries or initiate business moves, and it should be more worrisome if the existing investors are packing up. From the United Nations Conference on Trade and Development annual report, it was stated that developing countries now hold a 35% share of global foreign direct investment, and if the African economy must grow beyond where it is, there is the need to take a lion portion of that percentage share.
When in 1990, Tim Berners-Lee invented the World Wide Web (WWW), no one imagined the extent to which it would go. Besides the major impacts the internet has had, the most popular is the social media – as at now, over two billion people worldwide use Facebook, and it is still growing. Mark Zuckerberg, the owner of Facebook did not invent the internet – he only took advantage of it. Today, almost all businesses involve the use of the internet, and when people use it, the users hardly think about those who invented it. The internet is a research discovery that has affected positively, every aspect of the world’s economy. To grow the African economy, research funding must be the paramount goal of African leaders. Research funding is not a waste of money; it is shameful to imagine that it is. The governments must fund research institutions, colleges, and universities – it is essential to do so if we are honest about growing the African economy.
The UK Guardian writes, “In Africa, the social and political consequences of corruption rob nations of resources and potential, and drive inequality, resentment and radicalization. Corruption cheats the continent’s governments of some $50bn annually, and stymies successful cities, sustainable economies, and safe societies.” Corruption hinders economic growths on all fronts – it plunders economic successes that have been achieved and discourages potential achievements. On South Africa, The Economist writes, “The effect of mismanagement and corruption is best seen in measures of business confidence and the currency, both of which have plummeted since the start of Mr. Zuma’s presidency in 2009.” Just like Zuma, African leaders have not been free of corruption allegations, and the evidence before all are so glaring that it has become foolish and ludicrous to defend most of them.
In addition to corruption, frivolities and unwarranted spending, the cost of managing highly expensive democracy and lack of fiscal discipline have all contributed to the stagnation of African economy. The Premium Times Nigeria newspaper reported recently that Nigeria’s lawmakers budgeted 6.1 billion Nigeria currency for the purchase of official cars, and this runs into multi million dollars. In spite of the recessive economy, the appetite to squander scarce resources is their topmost priority. For every set of new lawmakers that make it to the house for each term in office, new and over the range expensive cars are purchased at the expense of the taxpayers. And when they leave office, or when each tenure ends, they sell the cars to themselves at extremely low ridiculous prices. These greedy attitudes hinder the growth of the economy.
One of the major drivers of economic growth is education that is fit for purpose – this is the education that combines academics with professionalism. The African educational curricula are dated, and most of its drivers are equally dated. In the west, academics prompt professionals about recent findings and the need to reposition, and in turn, professionals also tell academics what they need, and encourage them to research in that direction. But in Africa, we have marketing professors that don’t use the social media, they don’t know its relevance, and even openly criticise it. How on earth would a marketing professor not appreciate where the market is, or understand the immense opportunities inclined to it? Africa must learn from Philippine’s style of education – in the Philippines, you are prepared for the marketplace straight from the classroom, and for that, they produce some of the best doctors and nurses ready for export – even the domestic staff, hosts and hostesses, and cleaners are trained for export. These exports increase the percentage of remittances in the Philippines, which is a major boost to the economy.
In conclusion, I would say that the good intention to honestly grow an economy free of corruption, the readiness and willingness to do it, and the determination to make it happen to outweigh all other points that have been made in this little piece of writing. The consciences to see those under you have a good standard of living will inspire you to seek solutions on how to make sure the economy grows. To me, and for me, any economic growth that doesn’t reflect a good life for the people isn’t growth – there isn’t a need to grow on papers, and not grow for real – real economic growth is when the masses themselves are growing. It isn’t about what the World Bank says, nor is it about what IMF or Paris Club says; it is about what the people say – if the people are starving, the nation is starving – if the people are uncomfortable, the nation is uncomfortable. Economic growth must have a human face for it to make a sensible meaning!
