Africa has awakened to emerging creativity and innovativeness. Long considered to fit only to be on the receiving end of technology and innovation, Africa is now slowly becoming an actor in the innovation domain.
The new growth frontier
Anyone who has been to Africa ten years ago would hardly recognize the places he has seen if he visited them again today. In ten years, the continent has undergone dramatic changes and a stunning wave of entrepreneurial mindset has transformed African cities into vibrant centres of a new economic dynamism. From Dakar to Dar-es-Salaam and from Luanda to Nairobi, an unusual spirit of creativity is hatching among the young generation of African inventors, managers and investors in cities and villages all across the continent to bring the destiny of their communities to the next level. Long dismissed as the hopeless continent because of decades of dismal economic performance, Africa is now the rising continent. Africa has awakened to emerging creativity and innovativeness.
Long considered to fit only to be on the receiving end of technology and innovation, Africa is now slowly becoming an actor in the innovation domain. The new African dynamics in the innovation capabilities ispartly the result of a growing access to high quality education both in African and overseas universities. Young African researchers and inventors have started to produce and market innovative ideas to the world. From software development by young Ghanaian entrepreneurs such as IwalleT or Dropfi, to mobile banking in Nairobi, Africa is vibrant with creative ideas and investment opportunities. The customary Afro-pessimism that characterized Western perception of African economic outlook has slowly vanished even from the psyche of economic analysts who now call Africa is the new growth frontier. As a result of this wave of optimism, positive expectations about growth and investmentprospects are all around the press. With increasing reliability of governance institutions and a significant reduction in corruption levels, the investment risk has also been considerably reduced in many African countries. Attractive market expectations have revived the enthusiasm of various investors from East and West, who are now eager to come to Africa in search for growth opportunities and higher returns for their investments. This recent dynamism of African owes much its strength to the arrival of China on the African resource market.
For all criticism in Western media about Chinese neocolonialism and threats to human rights for Africa, its hands-on approach towards Africa has succeeded where decades of development assistance from the West had failed. Where Western good intentions accompanied by disastrous policies aimed at deciding for Africans what was good for them had plunged the continent in economic stagnation and an unbridled looting of its resources, the Chinese approach of exchanging natural resources for the construction of the urgently needed infrastructure has greatly contributed to laying the foundation of the positive new dynamism we see today.
New dynamics in the natural resource market
The continent has the world’s richest concentration of mineral resources ranging from precious metals such as platinum, chromium, manganese and gold to the strategic minerals such as coltan and cobalt. The US geological survey estimated that more than 50% of world chromium reserves and 85 % of platinum reserves are located in Africa, while more than 56% of cobalt reserves are in the Democratic Republic of Congo (DRC) alone. This latter is also very rich in coltan, a mineral that is essential for the production of mobile phones, portable computers and game consoles because of its high energy capacitance properties. Long dominated by Western trade partners through priority access agreements, the African natural resource market has now been open to new payers such as Brazil, India and China.
Before the arrival of China on the African resource market, the pattern of exploitation and trade of African resources from the colonial period on was primarily determined by the security imperatives of Western countries and their governments in the Cold War context. Because of their strategic importance for the defense industry and energy security of Western governments, Africa natural resources had become the object of secret military accords between autocratic rulers and their former colonial masters instead of serving for African development. In the new setting,
China has played a particularly important role in transforming African resources from the cause of conflict and instability into a source of economic recovery in many African economies. By its high demand for energy and raw materials needed to feed its expanding manufacturing sector, China has also induced a substantial increase in the
prices of most natural resources which allowed resource-rich countries to generate more revenues and expand their
investment capacity. In the ten years preceding the 2008 financial crisis, for example, China’s consumption of crude
oil nearly doubled, and during the same period its consumption of copper and iron ore has tripled while that of aluminium quadrupled. This is what has created the unprecedented export opportunities enjoyed today by African countries rich in those resources. Trade with China, whose volume was in excess of US$ 170 billion for 2012, will
continue to play a key role in this new dynamism.
The creative way of financing large infrastructure projects, known as Angola-mode (loans extended through the Chinese Ex-Im Bank are backed by a repayment in natural resources to Chinese companies) has largely eased the external borrowing constraints for many resource-rich African countries.China’s increased involvement in Africa has also created demand for other services essential to doing business, providing new opportunities for banks, law firms, and various other service providers. The sustainability and flexibility of China’s contemporary engagement in Africa is also expected to significantly contribute to sustaining Africa’s current construction boom, which is both a visible signal and an engine of African economic transformation.
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