middle class

Is the African “Opportunity” for Africans, or for Everyone Else?

Last week, I gave a lecture at the Georgia Tech Scheller College of Business (Atlanta, Georgia) entitled “Miracle or Mirage: Defining the African ‘Opportunity’”.  I spent some time discussing the various economic indicators that speak to the remarkable growth over the past two decades as well as the wonderful opportunities that exist in Africa today.  The main point of the presentation was that, when it comes to Africa, neither the blind optimist nor the doom-and-gloom commentator has correctly defined Africa as we know it today.  Rather, the true meaning of Africa lies somewhere in between these two narratives.

infographic_africa

There is desperation and misery the likes of which most people here in the US have never seen.  But on the other side…optimism and startling affluence abound. The contrast of poverty and wealth, in close proximity, is jarring.  It takes a little getting used to…at first.  But then, it becomes part of the natural landscape.

We observe this dichotomy; it registers in our minds; we pay it homage with our words.  But we are consumed with our daily affairs and it all fades to the background.  I do this.  You do this.  We all do this, day-in and day-out.

Whenever I travel to Africa, the first few days in whatever city I am in are always bitter-sweet.  I enjoy the local fare – nyama choma and ugali in Dar es Salaam or yebeg tibs in Addis Ababa.  The music is everywhere. Youssou N’Dour, Oliver Mtukudzi, Lucky Dube, or Ali Farka Toure sound off from a taxi or hole-in-the-wall joint.  I feel at home. It’s a beautiful thing.  But the fact that it is not all beautiful bothers me.  Sometimes I question the optimism surrounding Africa.  I hear about the African middle class and the continent’s growth spurt, but the reality on the ground draws my attention to the sad irony.

Where is the African middle class?

There is significant confusion regarding its true size, in population numbers.  Nevertheless, consumer spending continues to rise.  Global brands criss-cross the continent to access this consumer market.  But talk to anyone on the ground and they will tell you a variation of this story – one that points at the ever-widening gap in incomes.  They will point to the fact that those who spend discretionary income do so from a perch of vulnerability – desperately trying to buy into (pun intended) the dream of economic prosperity.  Of course, the fact that there are more people who have discretionary income is a sign of progress.  Everything else, one can argue, is the noise that makes the whole matter “messy”.

But are we trading in real progress for messy progress?  Are we settling for mediocrity?

We congratulate ourselves for the messy progress, often times failing to grapple with the long-term impact of the sustained dichotomy that is African society today.

As consumerism grows and the gap between the rich and poor with it, how will the stability profile of African nations change?  Mass unrest, on the scale of what is going on in Turkey, Brazil, Thailand and other emerging markets, middleclass protestif it were to happen in Africa, would significantly shake some political establishments already tenuous and lead to more chaos.

Or, maybe, the better question is: how can African nations leverage consumer spending power (expected to reach $1 trillion by 2020) to the benefit all of their citizens, and not just the consuming few?  How can African nations, as richly endowed as they are, become price makers and not just price takers?

I believe part of the answer to this is in shifting the narrative about Africa’s “opportunity” away from the perspective of the outside investor to a more internal and sustainable discussion about how the growth of the middle class can have a far-reaching influence on poverty reduction, good governance, and geopolitical stability in Africa.

Make no mistake, Africa is heading in the right direction.  With stronger regional ties, cohesive societies demanding government accountability, and beneficial partnerships between the private and public sectors, we will start to witness the African “opportunity” materializing for Africans.

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