demand will treble, while the number of passenger flights will more than double
every decade from around 100 million today and 1.7 billion by 2050. Instead of
just exporting commodities, Africa will be consuming them, too.
An enviable macro-economic backdrop
The macro-economic backdrop is probably the best it’s ever been in Africa,
and supportive for stronger growth. SSA inflation dropped into the single digits
in 2003, while government finances have vastly improved since a generation ago.
While the West was on its debt-fuelled binge in the run-up to the global financial
crisis, SSA was slashing its public debt ratio from 70% of GDP in 2000 to 32% of
by 2009. As consumers in the UK, Spain and the US pushed personal debt levels
towards 100% of GDP, household debt in Africa has remained at levels closer
to 0-10% of GDP across much of the continent. And while Western banks pro-
moted increasingly complex instruments that neither they nor their customers
fully understood, Kenya’s Safaricom pioneered a new way of moving money via
mobile phones that has provided access to financial services for millions. The in-
creasingly well-known M-PESA system offers a template for the entire continent
and much of the emerging world to copy from Africa.
Increased macro stability has helped deliver credit ratings across Africa that
support the growing global appetite for African assets. Local-currency debt
markets, which in emerging markets were short-term and volatile in the 1990s,
already extend out to 30 years in Kenya. Local pension funds—with assets
of nearly $260 billion in SSA—are significant players in local debt and equity
markets, and we cautiously assume they will grow to $7 trillion in SSA and $10
trillion across Africa by 2050. Many African countries have already done more
to encourage private pension provision than most Asian and many European
countries, and will be in a strong position to provide a secure future for the fast-
It’s possible that the Renaissance vision of a democratic, richer, healthier, in-
creasingly educated Africa will be seen as optimistic. Or deluded, or self-serving.
But we think that what we outline below will convince you otherwise.
Our base case is that Africa continues the trajectory it began a decade ago,
taking up the baton of “fastest growth” from Developing Asia and India, as it fol-
lows the path they have already trodden, with added fuel provided by ever-larger
global markets and new technology. The continent is already more democratic,