Growth Strategies for Africa in a Changing Global Environment

1. Growth Strategies for Africa in a Changing Global Environment Danny Leipziger and Shahid Yusuf Growth Dialogue Washington DC

2. What is different now: on the upside • Africa has growth momentum. • Many countries have achieved macroeconomic stability. • Demand for mineral wealth is strong. • South –south trade on upward trend. • Chinese and other FDI helping to promote mineral sector and infrastructure development. • Advantages of a ‘late starter’ likely to be buoyed by transfer of industry from East Asia.

3. What is different now: worrisome trends and challenges • Industrial growth is lagging, and share in GDP declining. • Little progress with industrial and export diversification. • Agricultural productivity and R&D remain low and rural infrastructure underdeveloped. • Climate change looms ahead threatening drying, water scarcity, extreme weather events, and coastal inundation. • Gross savings have declined, investment shows only modest increase.

4. Enhancing Long-Run Growth Prospects: Global Public Goods • Supporting globalization esp. international and regional trade and FDI. • Strengthening institutions contributing to political stability. • Working with other nations to contain global warming.

5. Enhancing Growth Prospects: National and Regional Drivers • Natural resources exploitation and management of revenues. • Youth dividend; Quality of human capital. • Scope for export-oriented industrialization. • Lifting agricultural productivity. • Narrowing technology gaps. • Urban agglomeration economies. • Demand from growing middle class.

6. Elements of Strategic Framework • Democratic institutions. • State implementation capacity. • Resource mobilization and investment. • Industrial and export diversification. • Learning and innovation system. • Aid and FDI.

7. Thank You