African Arguments, a think tank that seeks to promote the understanding of issues about Africa, argues that “One of the most common narratives that has dominated international headlines is that seven of the ten fastest growing economies are in Africa. But does this really stand up to scrutiny? This list was computed by the Economist in 2011, and continues to be quoted by every major world leader and opinion shaper. The exercise excluded countries with a population of less than 10 million and also the post-conflict booming Iraq and Afghanistan.
The Economist was reporting forecasts made for 2011 to 2015, and as African arguments reports, “there is a difference between forecasted and actually measured growth. According to John Kenneth Galbraith, the
only function of economic forecasting is to make astrology look respectable. So how good is the IMF at forecasting growth in Low Income Countries?
Among those on the list of the fastest growers were countries like Nigeria, Ghana, and Ethiopia. The news that both Nigerian and Ghanaian GDP doubled following the introduction of new benchmark years for estimating GDP in 2010 and 2014 should remind us that the pinpoint accuracy of these growth estimates is lacking.” Still, this is a valid point by African arguments. Is the ‘seven out of ten fastest growing economies’ myth really true? Are African economies growing, and who is benefiting from this growth?
One of the clear inadequacies of African economies is a lack of appropriate data to measure statistics and data that capture economic activities. No one knows the exact unemployment rates in the continent. Also, no one knows the exact levels of GDP that the informal economy plays into the overall GDP. Indeed, according to Nobel Prize winning economist, Hernando De Soto, large parts of Africa consist of economic activity that is not captured by mainstream data, and such people cannot use their capital to borrow loans from banks, or undertake other meaningful economic activity.
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