Africa's Recent Economic Growth: What Are the Contributing Factors?

Abstract

This paper analyses the characteristics of the recent African economic growth. The data reveal that during the period 1995–2005, Africa caught up with East Asia in terms of economic growth and investment. However, East Asia has improved its advantage on Africa in terms of GDP per capita and growth fundamentals. African economic growth rate was 2.2 percentage points higher during the period 1995–2005 compared to the period 1975–94. However, between the two periods, only primary education, exports and urbanization have significantly increased in Africa. The other growth determinants have either slightly deteriorated or remained stagnant. The results of growth regressions over the period 1995–2005 indicate that investment, private sector access to credit, government effectiveness, exports and the share of agriculture value added in GDP are significantly linked with economic growth. Thus, compared to the statistical analysis, growth regressions suggest that most of the variables which have significantly contributed to growth recovery are not those variables which have positively evolved in Africa. The good news is that African economies have grown recently without changing many growth fundamentals. The bad news is that the recent African growth recovery may not be sustainable if efforts are not focused on right growth fundamentals.

Threshold Effects of Debt on Economic Growth in Africa

“…This suggests that population growth, 4 investment, openness to trade and foreign direct investment enhance economic growth while government spending harms growth in Africa, which is in accordance with most empirical literature on economic growth. Kremer et al (2013), Mijiyawa (2013) and Thanh (2015) also find that investment enhances growth, Vinayagathasan (2013) finds that openness to trade spurs economic growth as well. Indeed, trade openness spurs growth by raising productivity and competitiveness, and by allowing technological imitation (Edwards, 1997).…”

The Slow Economic Growth in Algeria: A Comparative Study with Respect to South Korea

“…The authors found that primary schooling had a negative effect on growth in Africa and the Middle East, an insignificant effect in South Asia and Latin America and a positive effect in East Asia. In contrast, some other studies find that primary education is more important than other levels of education (Petrakis and Stamatakis, ; Papageorgiou, ; Gutema and Bekele, ; Mijiyawa, ).…”

“…In other countries, however, the relationship between growth and human capital does not seem so clear, and even rarely studied, as is the case in Algeria. Nevertheless, some studies have underlined the relevance of this relationship in African countries' growth, among them Anyanwu () and Mijiyawa ().…”

Determinants of the Recent Growth Surge in Africa : What Changed since mid - 1990 s ?

“…Recall also that A. Mijiyawa (2003) introduced, among others, similar exogenous factors in his study of the Africa's drivers of growth over the period [1995][1996][1997][1998][1999][2000][2001][2002][2003][2004][2005]. He found that the measure physical capital accumulation and the measure of the effectiveness of government are linked significantly and positively to growth.…”