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  5. African Economy in 2025: How will African economy develop?

2009 Vol.1
African Economy in 2025: How will African economy develop?

2009/01/01

African economy has been a minor player in the World economy. African countries tend to be known by regional conflicts, malaria, HIV/AIDS and poverty, and are target of donor’s aid, rather than business partners. However, due to recent increase of resource prices, some countries in Africa started to make a rapid economic growth and an average economic growth of Sub-Sahara Africa is more than that of advanced countries. The population of Africa is increasing by a rate two times of advanced countries, and population structure maintains “pyramid shape” until 2025, different from aging society of advanced countries. Africa has huge potential in developing its resources including oil, natural gas, mineral resources, hydro-power and agriculture, which has been hindered from development by regional conflicts, state ownership and other institutional barriers of the governments. There are concepts of economic corridor development at various location of African continent, which is to unlock resources of inland countries with regional development covering neighboring countries. Furthermore, there exists regional economic communities to form a free trade area with lowering tariff and, in the future, to introduce common monetary currency, and those communities started to form coalition to establish larger free trade areas. In order to sustain and enhance Africa’s development, “soft” powers are important to be accompanied with investment and trade by encouraging human resource development, environment conservation and local community development. African countries have been in close cooperation with their former colonial leaders in Europe, however, in these days, Asian countries including China and India are emerging as business partners. The East-West cooperation is expected to play more important role for African development.

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