Africa low on agenda at World Economic Forum

In this Swiss Alps town where the global elite have gathered to debate the world’s problems, there seems to be little room on the radar for Africa, a continent of over a billion people where a commodity-fueled growth boom has soured with a vengeance.
Sub-Saharan Africa’s economies, described a few years ago by consultancy McKinsey as “lions on the move,” likely expanded just 1.6 percent last year according to the World Bank — the slowest rate in two decades and one that lags the continent’s galloping population growth.
This week, investors were reminded afresh of Africa’s fragile record on democracy and governance.
These issues seem a world away from the rich slopes of Davos, particularly this year when many political and business leaders are preoccupied with the inauguration of President Donald Trump and fractures in Europe.
“A combination of politics and populism is continuing to take precedence on a worldwide basis compared to Africa,” Robert Moritz, global chairman of consultancy PWC, told the Reuters Global Markets Forum in Davos.
“Africa has a lot of long-term potential but people are questioning how quickly they can realize that potential so they are not spending as much time on that compared to the rest of the world,” Moritz added.
That shift coincides with a lackluster economic picture.
Not too long ago, in around 2010-2014, Davos attendees were captivated by the Africa Rising narrative.
Inspired by buoyant oil and commodity revenues, investors seized on faster economic growth than in the past and compared with the developed world, rising incomes and even peaceful political transitions, as proof of a structural shift. Now, that optimism has reversed.
Nigeria, Africa’s biggest economy, is in recession, and in danger of a currency crisis. The continent’s most industrialized economy, South Africa, celebrated for its post-apartheid democratic transformation, is struggling with sluggish growth and political squabbles that could see it lose its investment grade credit rating this year.
There have also been outbreaks of violence, even in Ethiopia and Ivory Coast — the African success stories of recent years.
Recent UN data showed that while stock and bond investment into Africa collapsed in 2016, “direct” bricks-and-mortar investment held steady at $82 billion.
The CEO of private equity firm Abraaj told Reuters that Africa was core to its investment plan and he would be keen to buy Barclays’ Africa business.
Charles Robertson, global chief economist at Renaissance Capital, compares East African states Rwanda, Kenya, Tanzania, Uganda and Ethiopia to South Korea in 1960, poverty-stricken before its industrial boom.

Source: Arab News