Countries in sub-Saharan Africa have experienced growth in gross domestic product (GDP) averaging 5% per annum over the last ten years. It is a growth rate that outstrips that of many other countries except some in South-East Asia, but unlike in Asian countries the growth has not translated into employment. Very large numbers of young people across Africa hope to enter the workforce with salaried jobs and career prospects, but though jobs have increased it has been at too slow a rate to absorb these people. This is ‘the Africa challenge’, and it could lead to increasing social tension unless growth can create jobs soon based on the economic advantages that have flowed from Africa’s wealth of natural resources. One solution is for African countries to strengthen their existing local economic fabric, such as by focusing support on small to medium-size firms and farms. Structural transformation in Africa cannot rely only on traditional job creation or direct foreign investment: too many thousands of people need work. Mineral and agricultural resources in Africa are actually underdeveloped in comparison to similarly resource-rich countries in other continents which have invested more heavily in exploration and export initiatives. African economies should encourage diverse primary production activities, to take advantage of their resource wealth without becoming dependent on a dominant natural resource: for example, by developing new plant and animal industries as well as mining, and by cross-investment and using revenue to create strong secondary and tertiary sectors. Industrial development needs wellstructured public services and business environments which can support mining and agriculture as well as manufacturing and knowledge industries. Such development may require more fiscal revenue as a percentage of GDP than may be available. Government investment in development projects to build local capacity, with or without contributions from foreign mining companies, will have social, environmental and economic implications.


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