Photo of Kigali, Rwanda by Flickr user oledoe under an Attribution-ShareAlike 2.0 Generic license.
By Francis Jung
According to the World Bank, the IMF and the US Agency for International Development (USAID), Rwanda is doing exceptionally well at attaining the development goals outlined in its Vision 2020, despite the Rwandan Genocide of 1994. Burundi, on the other hand, is not doing so well; especially since President Pierre Nkurunziza’s announcement to run for a third term in April of 2015. Why is Rwanda doing so well, while Burundi is doing so poorly when it comes to achieving human development goals?
At face value, the question seems broad and mundane to which any number of people in the development community could provide a separate answer, half of which would start out with, “that depends;” but a deeper analysis of their similarities suggest that it would be reasonable to draw from the two something specific that explains why one country has driven down poverty and infant mortality while maintaining stable growth rates and the other is all but re-immersed back into conflict.
This article establishes that the reason Rwanda is doing so well is mainly due to two factors: first, the consolidation of power, the exclusion of opposing parties and the establishment of a single-party state early on its post-conflict development and second, Rwanda’s focus on implementing the Sustainable Development Goals; and Burundi is doing so poorly because the government is vulnerable to power seeking, would-be political entrepreneurs.
By Catarina Santos
Since 2007, Nigeria has attracted the most foreign direct investment in Sub-Sahara Africa due to its well-developed legal and banking systems. However, Boko Haram’s spread of violence to regions where oil and gas are extracted is now intimidating investors. Economically empowering youth is a key piece in this puzzle: the private sector needs a workforce, and youth need employment opportunities as an alternative to joining insurgent groups. Although radicalized Nigerians have not yet reached European or American cities, the potential for global economic impact from terrorism in Nigeria deserves attention. This article discusses the importance of the private sector’s involvement in fighting Boko Haram in Nigeria and recommends that the private sector focus on engaging in the northeast region of the country. The private sector should provide capacity building in various skills, especially sustainable agriculture practices; support youth education; and provide financial grants in areas that government programs have not reached.
A youth rally in Lagos, Nigeria in September 2012. Youth compose a significant portion of Nigerian society and lack economic opportunities, making them vulnerable to recruitment by Boko Haram. Photo courtesy of Flickr user Temi Kogbe, under a Creative Commons Attribution 2.0 Generic License.
By William Kabagambe
In the twenty-first century, access to energy is vital to society’s basic needs. Modern energy sources are critical inputs to economic development, yet 1.2 billion people around the world live without access to electricity. In Africa alone, 600 million people do not have access to electricity, and even those with access use a fraction of the power that US citizens do.
Demand for energy in Sub-Saharan Africa (SSA) in particular is growing; the region is projected to consume close to 1,600 terawatt hours by 2040, four times the amount used in 2010. Despite the increasing demand, more than half of SSA’s nations are currently experiencing power shortages and rolling blackouts. Without reliable energy from the grid, most business and families must rely on generators. In SSA, generators can cost between three to six times more than they do in the rest of the world. Given the high costs of electricity generation, development objectives are increasingly difficult to attain, resulting in unemployment and economic stagnation. With growing populations and declining economic growth, the challenges to improved energy access are numerous. SSA must create critical infrastructure, implement effective policy and promote new sources of investments if it is to unlock its development potential.
A woman uses fuel to cook in Burkina Faso. The WHO estimates that around 3 billion people globally still cook and heat their homes using solid fuels in open fires and leaky stoves. Image courtesy of Flickr user TREEAID under a Creative Commons Attribution 2.0 Generic License.
By Motoki Aoki
In the past five years, the Kingdom of Morocco has been the most rapidly transforming economy in the unstable North African region—and arguably even in the world. Morocco has made an incredible leap in the World Bank’s 2015 Doing Business index, ranking 71 out of 189 economies compared to 130 in 2009. This dramatic improvement attracted the attention of the private sector, drawing even more foreign cash into the kingdom. In 2014, Morocco became the second-largest destination for FDI in North Africa and the third-largest recipient of FDI on the African continent. This year, Morocco continues to win foreign investors’ attention.
Last month, French aircraft company Figeac Aéro announced plans to invest $29 million to open a production plant in Morocco, generating 500 direct jobs. The French automaker PSA Peugeot Citroen will invest $632 million in a low-cost vehicle assembly factory, with production scheduled to start in 2019. This is estimated to create 4,500 direct jobs and 20,000 indirect jobs by the time the factory is operational. Additionally, Japanese company Furukawa Electric, the world’s third-largest fiber-optics manufacturer, is poised to invest $8 million to build a Moroccan plant and tap into the growing demand for communications infrastructure in Africa. Not only do these private investments create jobs, they also boost exports of vehicular, aeronautic, and electronic equipment.
Casablanca is an important trade and financial hub for both Morocco and the African continent.
By Ariel Gandolfo
Chinese official foreign direct investment (OFDI) stock in Africa reached $21.73 billion in 2012, and China’s Premier Li Keqiang stated that total investment will reach $100 billion by 2020. Over 2,000 Chinese companies have invested in sectors such as infrastructure, natural resource extraction, finance, and power generation.
In some cases, Chinese companies are involved in multi-million dollar contracts with multilateral finance institutions. The recent $300 million partnership between state-owned China International Trust and Investment Corporation (CITIC) and the International Finance Corporation to provide affordable homes in African cities is just one example. While few African companies possess the technical skills to build on such a massive scale, African workers can at least take advantage of the employment opportunities that these construction projects generate, right? Continue reading