Africa on the Move- Economic potential comparable to China's

The Organization for Economic Co-operation and Development (OECD) forecasts that economic activity in Africa will increase by 5.5 per cent in 2006 and again by a further 5.5 per cent in 2007. OECD reports that inflation has remained at historical lows despite rising oil prices and trade balances have improved in many countries.

Its annual review African Economic Outlook published in May 2006 states: "Overall, the outlook for much of Africa continues to be more favorable than it has been for many years. Continued global expansion means sustained demand and higher prices for African oil and other industrial raw materials. An increase in official development aid and improving macroeconomic stability have also contributed to Africa's positive economic outlook. In addition, growth has been boosted by increased oil production in Southern and Central Africa."

Africa's population is approaching 900 million and therefore has a market potential, and labor pool, approaching that of China. The success of China's market economy has been phenomenal. Can Africa do the same? There is one group that seems to think it can...the Chinese. Entrepreneurs from China have been to the forefront of economic engagement in Africa in recent years.

European and North American businesses are also beginning to recognize the opportunities Africa presents. Its resources are vast and varied. As the world enters an era of energy shortages Africa has more than 114 billion barrels of proved oil reserves compared to North America's 59 billion. While North America's reserves have almost halved in the past 20 years Africa's have almost doubled. In the twenty years from 1985 to 2005 Africa's proved natural gas resources have risen from 6.16 to 14.39 trillion cubic meters while North America's has fallen from 10.7 to 7.46.

Africa's energy reserves have been increasing at a time when shortages are arising elsewhere. Increasing oil and gas prices have strongly benefitted economies in countries such as Nigeria, Algeria, Angola etc and have given Africa's oil-producing states the opportunity to invest in transport infrastructure and education.

For Africa's energy-importing countries increased prices have posed a challenge that most of them have been able to overcome. High energy prices have been counterbalanced by other natural resources. Africa is immensely rich in minerals. Gold and platinum abound in the south with South Africa the world's biggest producer in this area. Diamonds have made a strong contribution to many African economies and uranium resources are considerable not only in Southern Africa where they have been a by-product of gold production but also in West African countries such as Niger.

In Agriculture strides have been made towards profitability. South African wines, long boycotted by westerners during the apartheid era, are making a strong comeback on international markets. Although it is an Islamic country Algeria has been producing first class wines for almost a century. Until recently France has been its only significant customer but now new markets for Algeria's wine production have opened up in Canada, the United States, South Korea and Western Europe thanks to a strong and highly professional marketing campaign. Other African wine producers such as Morocco have begun to take note.

Long a weak point of Africa's economic profile, transportation infrastructure has been steadily improving to cater not only for internal traffic. Increased disposable income in the burgeoning economies of the west has provided a constant flow of international tourism and Africa's potential here is also immense. From the wonders of Ancient Egypt, the Mediterranean resorts of North Africa, the opportunity to watch animals ranging from big game to the Southern Right Whale in their natural habitat, the spectacular Victoria Falls and splendor of the Cape of Good Hope, few places can offer such diversity and natural beauty. Airports and hotel facilities have kept pace with international developments.

Perhaps the area in which development potential is at its greatest is that of Agriculture. The continents range of products is unmatched. Many of them are of the highest quality. Kenyan coffee matches its Brazilian and Java counterparts, tropical fruits abound. Climatic conditions range from Mediterranean in the far north and far south through sub-tropical, tropical and equatorial providing the ability produce a vast range of products.

It is in agriculture where trade restrictions are at their strongest. It is therefore in this sector that liberalization of trade can bring some of the most striking benefits to a region in which food shortages frequently reach crisis level.