The continent leads the world in terms of GDP and population growth, but that doesn’t seem to be prompting the same kind of frenzy that once accompanied China’s rise.

If you just pay attention to the data, Africa should be the next big thing, with six of the top ten growing emerging economies worldwide located on the continent, according to a recent Visual Capitalist graphic.

But you don’t hear about the consumer goods companies of the world salivating to get their hands on the next generation of consumers, while there are very private banks or wealth managers looking at opening franchises in expectation of a new, young generation of high-net-worth clients. And when it comes to financial markets, apart from Johannesburg, there appears to be little out there.

Market Conundrum

The question is whether the business world and markets are getting it all wrong, particularly as the data, based on the International Monetary Fund’s April 2024 world economic outlook, shows Mozambique is expected to post a compound annual growth rate (CAGR) of 7.9 percent over the next five years, followed by Rwanda (7.2 percent), Ethiopia (6.7 percent), Niger (6.7 percent), Uganda (6.6 percent), and Senegal (6.3 percent).

That seems salient given Asia has only one entry (Vietnam – 6.4 percent) on the same top 10 list - unless you include the Indian subcontinent, in which Bangladesh, which is expected to grow 6.8 percent, makes it, as does India itself (up 6.5 percent).

Population Gains

The same goes for the population. While the rest of the world, including much of Asia, and China, fight declining populations, the opposite is true for Africa.

The top ten countries for population growth are all on the continent. Importantly, Niger which makes the top ten in GDP, is second, with its population expected to grow 3.7 percent this year, followed by Uganda (up 3.2 percent). In fact, those are the only two countries in the world right now that are in the Goldilocks zone when it comes to economic and population growth.

Refrigerators to Bank Accounts

So, what gives? In the late 1970s and early 1980s following Deng Xiaoping’s reforms, as finews.asia has written, it was hard to get the average senior Western executive to stop talking about the more than 1 billion new consumers lying in wait who needed everything from refrigerators to bank accounts.

Part of the excitement back then may have been because of the simplicity and clarity of the situation. It was one country, one capital, a relatively rich Southern region, and a few major cities. In other words, it was easy to get your head around the potential and talk about it relatively knowledgeably in fairly short order.

Changing Nature

But there may be other factors at play here. The fabric and character of the economy worldwide isn't the same. Back then, when China started its rise, the first IBM PCs and Apple IIs entered average households, and consumer tech was seen as a nice, little, and faintly irrelevant, sideshow.

Now, we have NVDIA, the Magnificent Seven and big tech, and there seems to be little else, economically speaking. A consequence of that is that financial markets and businesses no longer get all that excited by a few billion shipments of white goods and cars here. That is also probably not helped by climate change and sustainability concerns. 

Where the Millionaires Are

But it might be because growth and wealth in Africa are just too diffuse, and there may be some latent stigma related to poverty, conflict, and governance concerns in certain countries at the top of the list, notably Rwanda, Ethiopia, Niger, and Uganda.

Those perceptions are not helped by a separate visualization indicating that over half of Africa’s current millionaires and 90 percent of its billionaires lived in just five countries (South Africa, Egypt, Nigeria, Kenya, and Morocco) and they are, largely, not the same ones where growth is currently coming from.

Prefer to Leave

Whatever the case, they also don’t seem to stay there, something that was not necessarily true of China in the 1980s and the four fledgling Asia Tigers back then.

Over 18,700 high-net-worth individuals left Africa between 2013 and 2023, and of the 54 African-born billionaires, only 21 still live there. Instead, most have moved to the UK, US, Australia, and the United Arab Emirates (UAE), with significant numbers additionally going to France, Switzerland, Monaco, Portugal, Canada, New Zealand and Israel.

Disappearing Stigma

But as with India, that kind of stigma can disappear over time just by keeping a high and steady pace of economic and population growth.

The question now is whether this will make Africa the new Asia. Looking at it purely by the numbers, the situation seems to be more than clear.