Could Africa Become The Next China In The Next 40 Years?

I know what you are thinking - easier said than done, right? Yes, it is feasible, but we need to look at several factors that come into play. To set the stage, first of all, let’s look at China. When the Communist Party came into power on 1 October 1949 and the communist leader Chairman Mao Zedong announced the creation of the People’s Republic of China, the country was very poor. Nobody would have thought China had a chance to become the economic giant of Asia and the world. I bet most people will doubt that Africa is the future. China today 50 years ago was one of the poorest countries with an impoverished population, about 60-80 percent (depending on source and definition) of the population living in poverty ended poverty in 2020, who would have thought?

 China's economic success story that we all watch or read about didn’t happen overnight, it took time. Even when  Mao Zedong attempted to rapidly industrialize China's peasant economy,  it failed and 10-40 million people died between 1959 and 1961, but they kept their development plan on track.

 It took China's commitment to growth, and mixed economic systems from the government, private sector, reform commissions, and stakeholders to achieve such massive economic growth and build a tremendous infrastructure across the country on a large scale.

Now let’s look at industrialization. The industrialization era began in England, which became the first industrial empire. No wonder they were able to rule the majority of the world on the land in the sea. Other European countries also follow suit and creating empires in their colonies in Africa and Asia. Then superpower status took a turn when the European powers suffered wars, their economies were in shambles. The United States of America emerged as the biggest economic power since 1945 till this day as a unipolar world superpower. About 60 percent of the world's trading is denominated in US dollars and settled in US dollars. The US banking system dominates the transaction by way of the SWIFT system. But let’s face it, nothing lasts forever, there is the tendency of a multi-polar world with China’s advancement and emerging and expansion of BRICS.

China As Inspirations For Africa

Was China’s economic growth a miracle?  Certainly not. In the early 1980s, the Chinese government decided to develop its economy by way of industrialization.  So how do you measure the economic returns? China’s development saw almost 10 percent compound economic growth per year for 40 years. This means fundamentally the Chinese economy doubles in size every 7 years. So in 35 years, the economy doubled in size five times. I think China's development should inspire other struggling countries across Africa to draw a roadmap for economic growth by following China’s footprint- investing heavily in infrastructure, good education systems, industrialization, value chain, investment in technology, and importantly, favorable geo-political environment.

Factors That Propelled China To Become A Economic Superpower

China was extremely effective in economic growth which surprised the global players. Let's dive deeper into each of these factors that made China's economy a success story.

1.   Market-oriented reforms

China's transition from a centrally planned economy to a more market-oriented one was a pivotal moment in its economic history. Under Deng Xiaoping's leadership, the country embarked on a series of reforms known as the "Chinese Economic Reform" or "Socialism with Chinese characteristics." These reforms involved dismantling collective farming, introducing elements of private ownership, liberalizing prices, and allowing for the establishment of private businesses. Deng famously declared, "To get rich is glorious," signaling a shift towards embracing economic prosperity and incentivizing entrepreneurship.

2.   Labor force

China's enormous population, exceeding 1.4 billion people, provided a vast labor pool that fueled its economic growth. The availability of inexpensive labor attracted both domestic and foreign investment, particularly in labor-intensive industries such as manufacturing. This abundant workforce enabled China to become the world's manufacturing hub, producing a wide range of goods for both domestic consumption and export.

3.   Export-oriented growth

China's economic strategy heavily emphasized export-led growth. By leveraging its large labor force and relatively low production costs, China positioned itself as a competitive player in global trade. The country's accession to the World Trade Organization (WTO) in 2001 further facilitated its integration into the global economy, opening up access to international markets and promoting exports. China's exports surged, driving significant economic expansion and contributing to its rise as an economic powerhouse.

4.   Investment in infrastructure

Recognizing the importance of infrastructure in supporting economic development, China embarked on ambitious infrastructure projects spanning transportation, energy, telecommunications, and urban development. These investments included the construction of highways, railways, ports, airports, power plants, and telecommunications networks. Improved infrastructure not only facilitated the movement of goods and people but also reduced logistical costs, enhanced productivity, and stimulated economic activity across various regions of the country.

5.   Education and skill development

China prioritized investments in education and human capital development to cultivate a skilled and innovative workforce capable of driving economic growth in the long term. The government implemented policies to expand access to education at all levels, improve the quality of education, and promote research and development (R&D) activities. As a result, China has seen remarkable progress in literacy rates, educational attainment, and the development of a highly skilled labor force, contributing to its competitiveness in the global economy.

6.   Government policies and planning

The Chinese government played a proactive role in guiding economic development through a combination of strategic planning, industrial policies, and targeted interventions. Central to these efforts were initiatives such as the establishment of special economic zones to attract foreign investment, preferential tax policies for key industries, subsidies for strategic sectors, and initiatives to promote innovation and technology transfer. Government-led planning and coordination helped channel resources toward priority areas, optimize resource allocation, and mitigate risks associated with economic restructuring.

7.   Integration into the global economy

China actively pursued integration into the global economy through trade liberalization, participation in international organizations, and engagement with global supply chains. By embracing globalization, China leveraged its comparative advantages in manufacturing, labor abundance, and export competitiveness to expand its presence in global markets. The country became deeply integrated into global value chains, supplying components and finished goods to multinational corporations and fostering economic interdependence with trading partners worldwide.

8.   Adaptation and Reform

China demonstrated remarkable adaptability and resilience in navigating economic challenges and seizing opportunities for reform. Over the decades, the country has continuously adjusted its economic policies, institutions, and regulatory framework to respond to changing domestic and global dynamics. Whether overcoming financial crises, addressing structural imbalances, or pursuing sustainable development goals, China has shown a willingness to experiment, innovate, and undertake bold reforms to sustain economic momentum and address emerging challenges.

 Read also: Is Chinese loans a debt trap diplomacy in Africa?

Africa’s Economic Development  By 2063

Exponential economic growth across Africa is possible if the geo-political environment is favorable for investment. Everything starts here. There won’t be any economic growth if the geo-political environment is not favorable. If we could live peacefully with our neighbors, and foster development partnerships with other countries, everything would be feasible. I'm not saying it is going to be easy.

Economic development has a very high return on investment than any type of investment because of its Compound Growth over long-term period. Take note,  not just Rate of Growth, which is for another discussion, but rather compound return on investment in either the state or the private sector.

Why 1963? Organization of African Union was formed on May 25, 1963, in Addis Ababa, Ethiopia to coincide with 100 years of the birth of this noble organization. That means that between now and 1963, all African countries must stick to this development goal. On paper 39 years looks far away but as the saying goes “The days are longer but the decades are shorter.” He who fails to plan plans to fail that is just the state of affairs.

Now let’s face it, Africa has an infrastructure gap in Africa. The railroad network in most African countries is non-existent and not robust. Is that a problem? Yes. the China you see today had the same challenges 80 years ago. Can the challenges be overcome? Absolutely. And that is where the government needs capital for the development.  The government can partner with the private sector to fund projects.

Every country that has ever moved from a low-income to an industrialized nation used the railroad for transportation by moving goods and raw materials from ports to factories for production and exportation. A good public infrastructure is very important to economic growth and China did it with excellence. I can't stress that enough.

 To sum it up, China's transformation from poverty to economic prominence has been shaped by a combination of visionary leadership, market-oriented reforms, strategic investments, integration into the global economy, and adaptive governance.

Most African countries are still greenfields with an abundance of natural resources. With a favorable geo-political environment which is the key to investment, Africa could surpass China’s growth in 40years time. I know this may sound a bit aggressive, but considering what the continent has, I don’t see any limit to our economic development freedom.

 And there you have it. Did you find value in this post? Leave your comments below.