The African Century

The usually busy Garden City Mall in Nairobi, March 2020. Photo: Wikimedia Commons In The Fortunes of Africa, author Martin Meredith describes a Dutch sailing ship that dropped off a load of laundry for the Khoikhoi, the local inhabitants of the southwestern cape of Africa whom Europeans called Hottentots. The year was 1713. The Khoikhoi washed the laundry and were duly paid. But the laundry was carrying smallpox. Over the next year, the community was laid to waste. Nine out of ten Khoikhoi died, and the tribe eventually disappeared from the Cape. Once again, a foreign pathogen is threatening Africa. The full impact of Covid-19 will be felt there later than in the rest of the world, but the financial markets have already exacted their toll. Even before the virus has made much headway on the continent, African currencies, sovereign debt, and public equities have fallen dramatically, in many cases experiencing losses far greater than in developed or other developing and emerging markets. The impact on African equity markets has already been worse than in the depths of the global financial crisis. But, if managed properly, the pandemic may prove to be a loud hiccup on the way to realising the African Century. As an investor and philanthropist in Africa for more than a decade, I have been focused on the unparalleled opportunity that the continent represents. As former South African President Thabo Mbeki put it in his 1999 victory speech, “The people of our country have given an unequivocal directive that we must work together for the African Renaissance, for the emergence of the 21st Century as the African century.” Strong underlying growth, attractive demographic trends, improved governance, stability, and transparency imply enormous opportunity over the long run, with the potential for tens of millions to be lifted out of poverty. Africa’s population, growing at 2.5% per year (about twice the pace of India), is expected almost to double within the next 30 years. By the end of this century, Africa will surpass Asia in the number of working-age adults. With this growth come challenges. Millions of able-bodied African young people will require education, jobs, housing, health care, and other social goods that their countries today are largely unable to provide. While the coming youth bulge holds great promise, it could jeopardize geopolitical stability if it is mishandled. A generation of under-educated, under-employed, and economically frustrated youth is a powder keg that could disrupt societies not just in Africa, but across the globe. Covid-19 will interrupt the African Century in the short term. Lockdown enforcement may cause social unrest. Already, there have been protests and near-riots in Nairobi, Johannesburg, and elsewhere. Lockdowns in large African cities are not the same as in China, Italy, or the United States. Housing settlements are informal and population densities are higher. Food and other essentials must be bought and consumed daily – often from open-air markets and kiosks, with cash earned the same day. Social distancing is impossible when five or more household members are sleeping in a single poorly ventilated room. Washing hands frequently is difficult when water has to be fetched from an unprotected community source down the road. Hunger speaks louder than government edicts. Most African workers are involved in primary agriculture and must be able to plant, harvest, and process their crops. After all, there is no point in living now only to starve later. African leaders will continue to look abroad for support. Many African governments, having tilted easily and early to the Chinese sphere of influence, have begun seeking alternatives elsewhere. But China will seek to capitalize on the crisis. For example, China will offer financial, medical, and other assistance, as it has with Italy. And China’s aggressive and decisive actions to combat the pandemic at home will be seen by many as a paradigm for Africa, given Europe and America’s disjointed and inept responses so far. But Africa could emerge from the pandemic with less lasting damage than many fear. Leaders have learned important lessons from epidemics, notably Ebola. Warm climates, a mostly young and rural population, and lower rates of regional travel may slow the spread of the virus and hold down its mortality rate. True, African institutions are too frail and under-resourced to cope with the pandemic and its economic fallout, and the continent’s medical systems are woefully unprepared. But financial and institutional support from Europe and the US will help mitigate the harm, particularly if solutions focus on delivering much-needed education, supplies, and infrastructure to where the needs are greatest. In order to realise the promise of the African Century in the not-too-distant future, African countries cannot do it alone. As Ken Ofori-Atta, Ghana’s finance minister, recently told the Financial Times, this is “a break the glass moment” for the continent – an emergency in which international actors need to take drastic action if the world’s poorest region is to avoid a human and economic catastrophe. Recognising Africa’s unique population, circumstances, and geopolitical significance is essential. We cannot permit Covid-19 to halt Africa’s progress. The continent’s leaders and its developed-country partners can and must contain the pandemic. The Khoikhoi’s fate is a warning. It must not become a prologue. Michael Wilkerson is CEO of Fairfax Africa Holdings Corporation and Board Chair of Atlas Mara. Copyright: Project Syndicate, 2020.www.project-syndicate.org Related The economic pain caused by Covid-19 shows we need to reshape African cities

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