DEVELOPMENT AND INVESTMENT

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Africa Development And Investment:

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Issues Affecting Africa’s  Development And Investment:

While Africa strives for development, and it forcefully positions itself into the global arena, Africa has consistently neglected to prioritize the way we is develops and invests in itself. There are numerous issues on what is slowing the growth and development of this great continent.

  1. Media and Branding of Africa:  “We have to be able to tell our own stories. For filmmakers and the press, it is going to be your job to redefine how people look at Africa. You see the good, the bad and ugly and what you choose to put out there, is what the world is going to get because I can tell you right now that in Chicago alone there are more people dying than the war in Iraq but you will never see that. There are a lot of things that happen in US that you will never see because they choose to show you what they want you to see,” Akon, who is American-born but of Senegalese descent said..
  2. Largest shadow economy: Although the poorest African countries have made significant economic progress over recent decades, it’s not due to great advice from the World Bank and IMF, which do a big disservice to African countries with advice and “help” that miss the mark. The fact remains, the region is not only the least developed in the world, but is also home to the largest shadow economy and lowest level of electricity use.
  3. Government is the problem. While the IMF wrongly insists that the informal, shadow economy in sub-Saharan Africa, which accounts for some 50% to 80% of GDP, is the result of inadequate government intervention. So while the Fund wants more spending on infrastructure, skills training, and technology, all problems are created by governments in the first place.
  4. Just look at regulation. African businesses face some of the most burdensome regulatory requirements in the world. On average, an African entrepreneur will spend 54% of his or her annual income in order to start a business. And if companies are even fortunate enough to get off the ground, they face tax rates that consume 47% of a company’s profits on average.
  5. It is no wonder then that African entrepreneurs invest in informal channels. It is a rational reaction to predatory taxation and onerous regulations. Instead of recognizing this, however, the World Bank insists that increasing taxation is critical to development, promoting that bad idea with a social media hashtag #Tax4Dev. Fostering a hostile business environment is going to do little to solve the issue of informality and diminished growth. In short, higher taxes won’t help businesses create jobs and flourish.
  6. Lack of secure property rights is another problem. Bureaucracy, regulation and corruption all plague government land registration systems in Africa. But over at the World Bank meeting, property rights were secondary to other policies — namely, more government spending.
  7. Finally, access to affordable, reliable energy remains a major problem. Over half of all African businesses report that lack of access to power restricts their operations. That, in turn, diminishes the region’s growth by 2% to 4% per year. That means lower incomes and, too often, premature death. Over 600,000 Africans die each year due to indoor air pollution as a result of inadequate access to fuel.
MINING

Africa, the world’s second largest continent, has tremendous potential within its mining sector due to the scale of its mineral endowment.

African countries already account for a significant portion of the world’s mineral output, with significant portions of the world’s reserves of

  • Gold – South Africa, Ghana, Tanzania,  Mali, Guinea
  • Copper
  • Cobalt
  • Diamonds
  • Manganese
  • Platinum-group metals

Compared to other major mining jurisdictions however, infrastructure challenges remain and hinder exploration and development activities which mean that the continent remains relatively underexplored and there is significant potential for major discoveries to drive future growth.

Key to the success of the mining industry in Africa is ensuring that the development of mineral wealth translates into benefits for the host countries and host communities. At Acacia, we are acutely aware of the importance of developing our assets in a responsible manner to aid in the development of our host countries and communities.

AGRICULTURE

As countries across sub-Saharan Africa grapple with the challenges of sustaining high levels of economic growth, plunging commodity prices, and the effects of climate change, revitalizing agriculture must become a priority on the continent.

The latest World Bank report warns that anemic recovery in emerging markets will weigh heavily on global growth prospects.  Its 2016 growth forecast for sub-Saharan Africa stands at 4.2 percent, up from 3.4 percent in 2015.

  • A vibrant, sustainable and resilient agriculture sector is vital for sub-Saharan Africa’s economic future. Indeed, African agriculture stands at the cusp of transformational change. The numbers are compelling:
  • Farming is the primary source of food and income for Africans and provides up to 60 percent of all jobs on the continent.
  • Food production in sub-Saharan Africa needs to increase by 60 percent over the next 15 years to feed a growing population. Africa’s food and beverage markets are buoyant and expected to top $1 trillion in value by 2030.

The agriculture and resource sectors together account for as much as 35 percent of GDP in the transition countries and for two-thirds of their exports. But they increasingly export manufactured goods, particularly to other African countries.

Successful products include processed fuels, processed food, chemicals, apparel, and cosmetics. As these countries diversified, their annual real GDP growth accelerated from 3.6 percent a year in the 1990s to 5.5 percent after 2000.

TOURSIM

Strong Tourism growth reflected in figures

One of the key findings of the report, as indicated in its introduction, is that the tourism sector in Africa is growing. In 2014, a total of 65.3 million international tourists visited the continent – around 200,000 more than in 2013. Back in 1990, Africa welcomed just 17.4 million visitors from abroad. The sector has therefore quadrupled in size in less than 15 years.

According to the World Tourism Organization (UNWTO), Africa’s strong performance in 2014 (up 4%) makes it one of the world’s fastest-growing tourist destinations, second only to Southeast Asia (up 6%).

 With a projected growth of 4.9% in and accounting for nearly 9% of the continent’s GDP,Africa’s travel and tourism industry has incredible potential to help generate growth, create jobs and enable development. Which country is best positioned to benefit most from travel and tourism?

Africa has not been left behind in the astro tourism craze.

  • The continent is regarded as having an edge over sprawling metros and urbanised hubs, where the night sky is almost never seen.
  • In the northern hemisphere, air pollutants and light pollution continue to cloud skies, leaving 60 percent of city dwellers in Europe and 80 percent in the U.S. unable to view the stars or our Milky Way galaxy.
  • This is why areas in Africa that lie far from large cities are prime destinations for this trending vacation activity. Moreover, most of Africa enjoys clear night skies for a good proportion of the year.

Top News On Africa’s Development And Investment:

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Price Indexes Affecting Africa Growth And development

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Commodities and Forex Index

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Market Quotes by TradingView

Africa Economic Calendar

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Economic Calendar by TradingView