The Quality of Growth in Africa by Akbar Noman

Author:Akbar Noman
Language: eng
Format: epub
Tags: BUS072000, Business & Economics/Development/Sustainable Development, POL053000, Political Science/World/African
Publisher: Columbia University Press
Published: 2019-08-19T16:00:00+00:00

CHAPTER 8

Sub-Saharan Africa’s Manufacturing Sector

BUILDING COMPLEXITY

Haroon Bhorat, Ravi Kanbur, Christopher Rooney, and François Steenkamp

Before 2000, Africa’s economic growth prospects were viewed with widespread pessimism. An over-reliance on mineral exports, civil war, and chronic corruption had ruined many of Africa’s economies, culminating in The Economist labeling it the “hopeless continent” (The Economist 2000). Since the turn of the millennium, however, the narrative has changed. Pessimism has changed to optimism, buoyed by the growth of an African middle class (Shimeles and Ncube 2015) and increasing foreign direct investment, which reached $60 billion in 2013—five times its 2000 level (Diop et al. 2015).

This optimism, however, has been tempered by unemployment—especially among young people—that has accompanied high levels of economic growth. Between 2000 and 2008, the African working-age population (fifteen to sixty-four years old) increased from 443 million to 550 million, but only 73 million jobs were created over the same period (Organisation for Economic Co-operation and Development [OECD] 2012; Sparreboom and Albee 2011). The youth only obtained 16 million or 22 percent of those jobs (Sparreboom and Albee 2011). Indeed, the Sub-Saharan African (SSA) youth unemployment rate decreased by only 1 percent over the past twenty years—from 13.4 percent (1991–2000) to 12.3 percent (2001–2012) (International Labour Organization 2014). In effect, the high growth rates have not generated a sufficient quantum of jobs to match the expansion in the labor force. The challenge is further exacerbated by estimates that state that each year between 2015 and 2035, five hundred thousand people in SSA will turn fifteen years old (Filmer and Fox 2014).

In the context of a growing labor force, debate continues over the prospects of Africa following in the economic footsteps of East and South Asia and the pursuit of manufacturing-led structural transformation, thereby creating jobs for a young and growing labor force (McMillan, Rodrik, and Verduzco-Gallo 2014; Rodrik 2014; Page 2012). This chapter contributes to this debate, which typically views manufacturing at the aggregate level, by providing a more granular product-level analysis of SSA’s evolving manufacturing sector, with the Asian experience serving as a counterpoint. The analysis is aided by the tools of complexity analysis, specifically those derived from The Atlas of Economic Complexity (see Hausmann et al. 2014).

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