In the decade to 2010, six of the world's fastest growing economies were in Sub-Saharan Africa. With all the right signs of growth evident in the future it is feasible that countries such as Angola, Ethopia, Chad, Mozambique and Rwand will soon be associated with wealth rather than poverty.
It is expected that, by 2020, more than half of African households ? almost 130 million ? will have discretionary income to spend (or save), up from 85 million today. There is also a growing working population, with the United Nations estimating the region will surpass that of China by 2040.
An increasing worker population combined with more take-home money means that a growing consumer sector is emerging in the continent. It has been found that the continent?s consumer industries are expected to grow a further $410 billion by 2020.
Critical to consumer growth is urbanisation, which is also on the up. Some 40 per cent of the African population lives in cities making it a more urbanised region than India. By 2016, more than 500 million Africans will live in urban centres, and the number of cities with more than one million people is expected to reach 65.
The ultimate Frontier
David Mataen?s book 'Africa: The Ultimate Frontier Market' offers some compelling insights on what can be achieved if recent trends in stability and productivity continue.
In order to ensure that the growth in both healthy and sustainable it is important that climate change, water management, food security and the development of capital markets are the focus, Mr Mataen believes.
If the past teaches us anything it is that political stability holds the key to equitable and continued prosperity. Corruption and disenfranchisement should become and remain a thing of the past, replaced by democratic and dynamic approaches to economic growth that will woo international investment. A stable political and economic environment will see overseas money swarm into a continent that is primed for growth.
What's driving growth in Africa?
Standard Bank analyst Simon Freemantle believes there are five factors driving economic growth in the continent. "Naturally Africa?s sheer size as well as often vastly differing economic and political dynamic renders generalisation problematic. However, the broad thrust of these trends is incorporating the majority of the continent?s emerging and aspiring economies," he said.
A 2.2 per cent average population growth coupled with strong economic growth means that a strong consumer base will emerge in the country. According to Freemantle, around 150 million Africans have entered the middle class since 1990 and a further 40 million households are expected to become middle class by 2015, creating a large population primed to spend money.
By 2050 more that 60 per cent of the continent's population will be urbanised, with megacities such as Lagos, Kinshasa and Cairo emerging. Smaller towns and cities will also be boosted by the population migration, which will support growing consumerism.
Technology is being widely embraced in Africa, particularly in the telecommunications sector. It is estimated that by 2015 there will be over 800 million mobile subscriptions in the continent, with a growing internet population emerging to boot.
Africa is home to 9.5 per cent of the world?s crude oil and eight per cent of the world?s natural gas reserves (according to 2010 estimates). There is also immense agricultural potential which will be called upon to feed a swelling population.
Finally the financial sector is showing real signs of growth and maturity. Much of the population still remains locked outside the financial system although that could change quickly. It has been projected based on current growth rates that Africa?s financial services sector could make up around 20 per cent of the continent?s collective GDP within the next decade, compared to 10 per cent today.