Let’s take a quick poll. Take a look around and ask the colleague, friend, family member, or stranger nearest to you which of the world’s continents will dominate the global economy in the year 2099.
How did they answer?
I’m guessing that many would bet on Asia with its heavy hitters China and India. A large percentage probably also said North America, expecting its hegemony to endure for another 90 years.
If your neighbor said Africa, however, you may be in the presence of real prescience. The stage is set for the continent to be the world’s economic powerhouse before the end of the century.
Africa’s Dropping Dependency Ratio
Last week we looked at the implications of Africa’s declining fertility rates – a hopeful trend triggered by big advances in the fight against child mortality. To summarize that article, African women are increasingly confident that their babies will survive to adulthood, and therefore decide to have fewer children. This allows families to invest more resources into the well-being of each child. The cumulative impact of all these household-level decisions taken over years and decades is an exponential increase in the productive capacity of the continent’s population.
Today, African adults, on average, support more dependents than do adults from any other region. This is measured by the dependency ratio. According to the UN, Africa’s dependency ratio is 79.5. This means that for every 100 African adults, there are roughly 80 children and elderly relying on them for food, shelter, healthcare, and education. In Asia, 100 adults care for just 47 children and elderly.
But thanks to lower fertility rates, Africa’s dependency ratio will decline steadily over the next four decades. Take a look at the chart below.
[easychart type=”vertbar” height=”150″ title=”Dependency Ratio for World Regions” groupnames=”2012, 2050″ groupcolors=”005599,229944″ valuenames=”Africa,Asia,Europe,Latin America,North America,Oceania” group1values=”79.5,47.3,47.1,51.1,50.2,52.2″ group2values=”58.7,54.1,72.7,57.2,65.8,59.0″ ]
Take a look at Europe in the above chart.
It’s pretty clear to see why its economic future looks so cloudy, isn’t it? In a few decades, Africa’s colonial powers will have some of the highest dependency ratios in the world. A hundred French workers will be caring for 71 children and elderly in 2050. Germany’s dependency ratio will be 77.6.
Growing — Not Graying
Granted, Africa’s workers will still shoulder more of a demographic burden than their counterparts in Asia. Asia’s 2050 dependency ratio is projected to be just 54.1 compared to Africa’s 58.1, but the second half of the century looks pretty wrinkly for Asia, as the chart below illustrates.
[table id=88 /]
Roughly 17% of Asia’s population will be age 65 or older in 2050. Meanwhile, over 30% of Africa’s population will be younger than age 15. Which one will be better prepared to compete in the latter half of the century?
Here Comes Everybody!
Finally, it’s important to note the scale of this shift. The following chart illustrates the trend with some real numbers.
[table id=89 /]
Africa will have 808 million more working-age citizens in 2050 than it does today – more than doubling its current pool of labor. This far surpasses any other continent. China will actually have 211 million fewer workers than it does now, while Nigeria alone will add 155 million. India will add an impressive number of workers between now and 2050, but arguably with a greater strain on its resource base.
The wild card to this prediction, of course, is whether African governments can effectively harness this demographic shift to productive ends.
But I’m very bullish. Few observers would have guessed 1912 China, riven as it was by violent internal conflict, would transform into an economic juggernaut within a century.
Africa, by contrast, is a continent of steadily improving stability, infrastructure, and political reform. Combine this with a growing, increasingly capable base of human capital, and the stage is set for the emergence of an African economic superpower.
What Do You Think?
I’d love to hear your feedback. Am I too optimistic? Tell us which countries and continents you think will be the centers of economic power at the end of the century in the comments!