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Africa’s Demographic Dynamics

Author: Kira Alberts

“Looking ahead, the continent’s young and increasing population presents an unprecedented opportunity to spur rapid development,” says the Africa Competitiveness Report 2017.

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Africa finds itself on the brink of a demographic boom as the United Nations projections paint a striking picture: the African population is expected to double to around 2.4 billion by 2050 and reach an astounding 4.2billion by 2100, even factoring in a predicted global decline in birth rates towards the end of the century.


At first glance, this is great news for Africa. A rapid growth of the young population would grant Africa a demographic dividend. What this means is that there is a surplus of working individuals compared to dependents, with the potential to create a window of opportunity for accelerated economic growth.


However, realizing the advantages of the demographic dividend hinges critically on the extent to which the working-age population can secure employment. As it stands, without substantial reforms, the continent’s economies are unlikely to create more than a quarter of the jobs needed for the 450 million working-age individuals by 2050. This inability to absorb the workforce into economic sectors will therefore stifle economic growth instead of boosting it.


A  burgeoning  but  unemployed population in Africa presents multifaceted  challenges, extending beyond mere economic ramifications. High levels of youth unemployment contribute  to  
increased  poverty, resulting in the growth of informal settlements and slums, where living conditions are often dire. The strain on the already limited healthcare and educational resources  will  be devastating. This confluence of factors not only jeopardizes individual well- being, but 
also fuels social unrest and political volatility  jeopardizing the stability of Africa's already vulnerable democracies.


What needs to be done?

Successfully navigating this demographic transition is contingent on several factors such as job creation, urban planning, educational development, and effective policy implementation, but at the core of it all lies infrastructure development. Infrastructure development not only aids in absorbing the burgeoning working population and facilitating human capital development, but it is also integral to sustaining economic growth in the long-term and ensuring that nations can support such large populations.


Infrastructure  development  includes expanding transportation with improved roads and public transit, ensuring a reliable   energy   supply   through investment in power generation, and developing water and sanitation systems.  Healthcare, education, housing, information 
technology, and industrial infrastructure also need to be prioritised.

Instead, Africa is dealing with a large infrastructure deficit, especially in the sub-Saharan region. The consequences of poor infrastructure in Africa are grim, shaving off two percentage points from national economic growth annually, and contributing to making sub-Saharan Africa the region with the lowest productivity levels globally. A glaring example of the impact of poor infrastructure is the region's subpar roads, rail systems, and port infrastructure, which inflate the costs of
intra-African trade by 30 to 40 percent. 


The  African  Development  Bank estimates that the continent requires up to $170 billion per year by 2025 to revamp its infrastructure, with approximately two-thirds earmarked for entirely new infrastructure  and the remaining  third allocated for maintenance. Alarmingly, there  
is a $100 billion funding shortfall, placing Africa in a rather desperate position.

The underinvestment in infrastructure is compounded by the concurrent rise in systemic corruption and a growing debt crisis. Fraud and corrupt practices result in staggering annual losses  of approximately $148 billion, which translates into about  5% of  the continent's average GDP. Since 2010, Africa's debt-to-GDP ratio has doubled, rapidly approaching the 60% mark, which is considered to be the sustainability threshold. This ratio is projected to rise by another 10% within the next five years, curbing sovereign spending on infrastructure.


To catalyse real progress in infrastructure development across Africa with the end goal of capitalising on the demographic dividend, governments must implement reforms that facilitate  capital  inflow  while simultaneously bolstering accountability, transparency, 
and the fight against corruption. Additionally, it is important to focus on infrastructure projects that are low carbon and climate-resilient, aligning with the African Union’s  Agenda 2063,  the United  Nations  agenda for climate change, and the UN Sustainable Development 
Goals. Furthermore, Africa must harness its resource strengths. The continent is abundant not only in traditional resources but also in energy transition minerals, such as lithium and cobalt, vital for the world's transition to sustainable energy sources.


None of these measures and strategies are new to the African community as there is already a great number of frameworks and plans to develop the continent. But a plan means very little without  execution.  Given that a demographic dividend only lasts for a few decades, African nations will need to urgently prioritise these outlined
strategies or risk facing the serious socio-economic and political consequences of the unavoidable demographic boom.


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