The growth of any country in a global economy has to be knowledge based. The gross domestic product (GDP) of the United States (whose economy grows at an annual rate of 4.4%) was $11.7 trillion in 2005 while
How has
Despite significant improvement in overall gross domestic product (GDP), a UN report states, “poverty has been unresponsive to economic growth…Underlying this trend is the fact that the majority of people (in Africa) have no jobs or secure sources of income.” Four challenges facing Africa include: achieving structural transformation to break away from the under-utilization of rural labor; addressing widespread youth unemployment; harnessing globalization to create decent jobs; and creating an enabling environment for accelerated expansion of private sector job creation through increased investments. The report argues that while macroeconomic performance has improved in
To create jobs, African economies should be transformed from low-productivity traditional agriculture to labor-intensive high value agriculture and agro-processing - and to the growing industrial and services sectors, taking advantage of globalization opportunities, the report argues. The distributions of African workers according to industries are: agriculture with 60%, manufacturing (15%), and the remaining 25% in investments and banking, mining and drilling, services, transportation and technology.
The knowledge economy
In the United States, the most productive sector of the economy is
In Silicon Valley, productivity increases by 16% per annum as the producers of computer hardware and software reinvent themselves every 18 months. Using ’Moores Law, the value of
The way forward
African governments ought to revitalize their economies from the negative performance of the past decades resulting from socialism and government interference in business. Better agricultural practices integrating
Open communication between nations and regions will also foster better understanding of already available technologies that would work in most areas. Instead of hoarding information and technology, governments need to facilitate better communication and opening of markets so that African economies can benefit from already invented methods instead of re-inventing the wheel. This will spur entrepreneurship and provide jobs which eventually lead to economic growth.
African governments should act as facilitators of economic growth instead of running the show. Most government parastatals never make any money. They are sources of employment for inefficient civil servants that are managed by ineffective leaders who don’t understand the meaning of productivity and profits. Governments should sell these organizations, get rid of the practice of price controls and let market forces determine the value of products.
The knowledge economy has already begun in Africa. Web developers in
Call centers are part of a vibrant South African market that competes with other centers in North Africa.
So what is the biggest need Africa has in order to tap into the knowledge economy?
Africa needs to address: access to affordable computers, solid training for
“Our biggest challenge is resources. By that, I am referring to the accessibility of the Internet to Africa. We want to reach the masses, but as with SA we will probably only hit the elite few who can afford broadband...can we change that with a future strategy?
By Joshua Wanyama
African Path
See http://www.africanpath.com/p_blogEntry.cfm?blogEntryID=629