Over the last two decades, Africa has experienced an average annual GDP growth of 4.6 percent. However, this growth has not led to improvements in the well-being of African people. With this in mind, The Quality of Growth in Africa (edited by Ravi Kanbur, Akbar Noman, and Joseph E. Stiglitz) offers insights about the quality of growth, centered around five themes: (1) an analysis of prosperity beyond the standard measure of GDP (Chapters One through Three); (2) structural transformation as a necessary condition for a shared prosperity (Chapters Four through Six); (3) the industrialization of Africa around agriculture, manufacturing, and global value chains (Chapters Seven through Ten); (4) growth and environmental sustainability (Chapters Eleven and Twelve); and finally (5) growth and urban development (Chapters Thirteen through Fifteen).
In Chapter One, Lorenzo Fioramonti discusses the inadequacy of GDP as measure of quality of growth in developing countries. This stems notably from the fact that GDP is blind to income distribution, costs induced by industrialization (i.e., pollution, environmental degradation), and the non-market and the informal economy, whose size is significant in Africa. In Chapter Two, Andy McKay assesses the growth performance in Sub-Saharan Africa (SSA) and finds that countries with weak growth performances have achieved limited progress in income poverty reduction. This result points to the potential importance of growth policies for poverty reduction. Discussing the quality of jobs and growth nexus in Chapter Three, Moazam Mahmood explains the high growth volatility in SSA by the fact that growth is led by commodities and extractives; this volatility undermines the improvement in job quality. He also notes the decrease in manufacturing.
This last observation naturally calls for structural transformation for quality growth. In Chapter Four, Antonio Andreoni, Ha-Joon Chang, and Isabel Estevez shed light on factors that constrain the “policy space” of African countries. They argue that global rules (i.e., intellectual property rights, infant industry provision, liberalization, etc.) prevent production transformation and capacity development in Africa, stifling the creation of quality jobs and structural change. Citing the East Asian experience in Chapter Five, Jomo Kwame Sundaram presents some principles that African countries should consider for a successful structural transformation, namely, macroeconomic discipline, good governance, higher saving and investment rates, and the provision of physical and social infrastructures. In Chapter Six, Akio Hosono sheds light on the importance of “soft” infrastructures, which are critical if countries are to build a dynamic comparative advantage.
In Chapter Seven, Christopher Cramer and John Sender explain the potential of agroindustrialization to improve quality of growth, given its ability to provide better jobs and boost productivity. This contrasts with the poor performance of the manufacturing sector in SSA over the last thirty-five years, as depicted in Chapter Eight. Haroon Bhorat et al. show that the most productive sectors in SSA are the capital-intensive and energy-based industries (mining and utilities), which have not created enough jobs. Thus, the relative stagnation of manufacturing in SSA rests on the fact that SSA countries have not acquired the capacity to produce complex products. Antonio Andreoni (Chapter Nine) states that the weakness of the manufacturing sector in Africa is due to the failure to transform local production systems (LPS), whose structure is mostly dualistic despite the emergence of global and regional value chains (GVC) since the early 1990s. Andreoni argues that GVC-led industrialization has not happened in Africa due to “institutional monopolies” (entry barriers such as patents, quality standards, copyrights, and trademarks) imposed by transnational companies. Power asymmetry in global production networks and the failure of domestic companies to master production technologies that create value may explain why Africa is confined in upstream resource-based sectors in GVC. In order to reshape markets, Simon Roberts (Chapter Ten) advocates for industrial policy and economic regulation to develop local productive capacities in the context of Southern Africa.
In Chapter Eleven, Ben Orlove theorizes that climate change will lead to a deterioration of natural capital and an inadequate provision of basic needs. To protect the environment and achieve economic development in Africa, Go Shimada (Chapter Twelve) advocates for green industrial policies. Without adaptative measures, climate change can fuel conflicts and drive further migration and urbanization.
In Chapter Thirteen, Takyiwaa Manuh and Edlam Abera Yemeru state that African cities experience high inequality, poverty, informality, and unemployment because urban and industrial development are delinked. Furthermore, unmanaged urban expansion puts a stress on the environment. Exploiting survey data from Tanzania, Luc Christiaensen and al. (Chapter Fourteen) find that migration to small towns contributes more to poverty reduction than migration to big cities. In Chapter Fifteen, Gabriella Carolini shows that almost 60 percent of the urban population in SSA live in slums. Thus, urban infrastructure investments should factor in the basic needs of most of the urban population for quality growth in African cities.
The editors of this book have brought together scholars and policymakers who present interesting perspectives about the quality of growth in Africa, with a focus on structural transformation, a key development agenda for Africa, but also on the environment and urbanization, two key megatrends reshaping the global economy. The wide range of topics and approaches offered here provide perspectives that will be of interest to anyone interested in African development and implications for future growth.
