AFRICA OUTLOOK

by Royce Lowe

Africa’s Journey To Urbanville

In 1950, Africa’s population was some 227 million. Today, with an annual growth rate since then of some 2.5% to 3.0%, it’s at 1.46 billion. In 1950, the urban population was just over 13% of the total; in 2015, the latest year for which continent-wide data is available, half the African population were city dwellers. This share is forecast to rise to over 70% by 2050.

By bringing people and companies into close contact, cities make both more productive. And even though urbanization is enriching Africans, they could be benefiting more.

African cities do not grow efficiently. This applies to really big cities, such as Lagos and Kinshasa, and towns and smaller cities where most African urbanites live. Today there are more city-dwellers in Kenya than there were in all of Africa in 1950.

The growth of Africa’s cities has, in general, been good for people. Wages in cities are about double what they are in the countryside, according to the OECD. Urbanites work 30% more hours per week than workers in the country. Today 50% of rural Africans live within 14km of a city, which means they can more easily access public and private services that cities offer.

Urbanization is good for Africa, but not as good as it could be. As cities get bigger, the economies of scale and attendant effects can lead to higher productivity. The World Bank, however, says African cities are “too crowded, too disconnected and too costly” to take full advantage of this. The inefficiency of African cities compounds the problem of cost. They are expensive. According to the World Bank, living costs such as food, housing, and transport are some 20 to 30% higher in African cities than in other developing nations. High wages to offset these high living costs equals less competitive industries. “Nontradable” services or construction, rather than export-oriented sectors, are what is produced in African cities. A low adult literacy rate aggravates the transition to a more productive, industrialized economy.

These negative factors do not augur well for a continent that is home to almost 20% of the world’s population. Manufacturing, and a goodly amount of Foreign Direct Investment, are essential for poverty reduction, as witnessed by those countries strong in them. If Africa is to progress significantly, it needs both.

Author profile: Royce Lowe, Manufacturing Talk Radio, UK and EU International Correspondent, Contributing Writer, Manufacturing Outlook. n