Academic journal article
By Mogae, Festus Gontebanye
Harvard International Review , Vol. 29, No. 2
There has recently been a revival of interest in Africa's economic potential on the part of international players. Indeed there have been many insinuations that the prevailing post-Cold War assessment of the continent as a place fit for little more than humanitarian concern may be changing. Perhaps we who are her sons and daughters can now derive some comfort from the fact that Africa is once more being appreciated as a place for economic and political competition. But the real question is whether mother Africa is becoming attractive, maybe even respectable, in the eyes of the international community. Regardless of the ultimate answer to this question, there is certainly something going on: a confluence of internal developments, external desires, and renewed opportunity.
One obvious factor in this recent development is the growing global demand for various commodities. To a considerable extent, this is being driven by economic growth in historically non-traditional markets for Africa's exports. This trend has coincided with the emergence of wider possibilities and challenges for the continent, resulting from the development of an increasingly globalized world. Within Africa, economic growth rates have risen and have contributed to the emergence of new openings for trade and investment. This general rejuvenation has furthermore been accompanied by enhanced levels of stability and good governance. The majority of sub-Saharan African states have experienced peaceful transitions of power over the last decade. But while the case for Africa as a place of opportunity is increasingly being supported by a multiplicity of positive indices, it nonetheless remains at variance with the still prevailing image of the continent as hopelessly trapped in a cycle of poverty, pestilence, corruption, social instability, and war.
Much of the popular interest to be found in the Western media regarding Africa's supposed courtship has been generated by China's emergence as an increasingly significant player, both in Africa and the world in general. My quick count of online news listings on "courting Africa" earlier this year revealed that nearly three-quarters of the relevant articles referred to expanded Sino-African cooperation. Yet while China's wooing of Africa is in itself worthy of consideration, the phenomenon ought to be understood within its broader context. When looking objectively at current economic and political trends on the continent, it is soberingly clear that Africa's emerging promise has heretofore resulted in relatively modest levels of trade and investment, especially from those quarters that have had a greater longstanding interest in its affairs.
The Importance of Image
For all that has so far been written and said about Africa's growing prominence, there is an obvious paradox in observing the gap between promise and delivery. Not long ago the US Government's Overseas Private Investment Corporation observed that while Africa now offers the highest rate of return in the world on foreign direct investment, it nonetheless attracts the lowest volume of capital inflow.
This is supported by the most recent World Bank World Development Indicators, which show that in 2004 sub-Saharan Africa attracted only 1.8 percent of the global flow of foreign direct investment, down from 2.3 percent in the 1980s, which is commonly described as Africa's "lost decade." This is notwithstanding the fact that total investment flow in absolute terms rose from only US$1.2 billion in 1990 to a still modest US$11.3 billion in 2004. In addition, according to the World Bank, sub-Saharan Africa's percentage of world trade has stagnated in recent years at approximately 1.5 percent, only about half what it was in the 1950s.
My own country, Botswana, has been rated as the world's number one destination for mining investment in a global risk survey by Resourcestocks, while a recent Carnegie Endowment study found that we were fourth in the world in overall return on investment income. …