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Report Highlights Economic Growth, Potential In Africa

A report from the consulting firm McKinsey & Company said “global businesses cannot afford to ignore the potential” in African economies, the New York Times reports.

Compiled by the company’s economic research center, the McKinsey Global Institute, the analysis points out that 316 million Africans, a number greater than the total U.S. population, have signed up for mobile phone service since 2000. Africa’s population of one billion also spent $860 billion in 2008, “more than India’s population of 1.2 billion,” the newspaper writes (Dugger, 6/23).  

TIME magazine also reports on the McKinsey analysis: “Nearly 32% of Africans now own cell phones. The continent’s individual national economies have mostly ridden out the worldwide recession and have doubled their rate of growth from 20 and 30 years ago. Of the 30 largest African economies, 27 have expanded over the past decade.”

The magazine examines the recent Overseas Development Institute report on the Millennium Development Goals and reports that “[f]iscal health, however, is almost always a knock-on effect of a population’s physical health” (Kluger, 6/24).

The McKinsey report also said serious conflicts resulting in the death of more than 1,000 people annually dropped to average of “2.6 a year in the 2000s from 4.8 in the 1990s,” the New York Times writes.

“The growth we’ve seen in Africa recently is much more widespread than is generally recognized,” said report author Arend van Wamelen. “Obviously, there are places in terrible shape,” he said, adding, “We’re not insensitive to that. But on the whole, if you look at the number of people who are destitute, those numbers are falling pretty drastically. The economic trickle down is there.”

“Some of the demographic trends praised in the report could turn out to be double-edged swords,” the newspaper writes. “By 2040, McKinsey projects, Africa will have 1.1 billion working-age people, more than in China or India. … Indeed, the report notes that Africa has been getting many more children into school but that it needs to do far better at giving them a quality education. The report also noted that Africa was urbanizing at a rapid rate. [It] acknowledged that cities could produce miserable slums, but it also maintained that they increased worker productivity, demand and investment” (Dugger, 6/23).