Publication Title: Boston Review
Abstract: I share Edward Miguel’s cautious optimism: the new millennium has started out well for Africa. Democracy is making steady progress, with genuinely contested elections more common and the press increasingly free. GDP per capita is growing at an average rate of 3 percent per year—not East-Asian miracle levels, but quite respectable for any developing country, and a sea change from the previous several decades in Africa. Foreign investment is rising; inflation has dropped in most countries; debt has fallen; and foreign exchange reserves have risen. High commodity prices have been a big driver of African growth, but there is evidence that the current boom is more broadly based. The explosive growth of cell phones, which are making markets more efficient and alleviating Africa’s curse of bad transportation networks, shows how technology and entrepreneurial innovation can radically change the economic environment. Finally, rapid economic growth in the rest of the developing world, particularly China and India, can only be to Africa’s advantage, and not only by raising commodity prices. As other countries get rich, there will be more demand for expensive sport shoes, and fewer people in the world poor enough to stitch them—and so the jobs (and millions like them) may migrate to Africa.