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Table of Contents
Natural Resources 3
SOUTH AFRICA 5
WORKS CITED 11
Africa has great economic potential brimming with human endeavor, opportunity, abundance and hope. Many write off Africa as the continent of despair, while other entrepreneurs have recognized the huge untapped business venture across the continent.
The world is starting to rethink Africa's role in global markets. In Africa, labor costs are well within Asian ranges and there is a need for job creation. African products have found a niche in the American market. There is an increased interest in traditional areas of opportunity for U.S. investors such as mining, gas, oil and agricultural products. There are numerous opportunities in the privatization of state-owned enterprises in utilities.
Africa is the second largest continent in the world. It has 54 independent countries - 48 mainland and 6 island states. Thirteen percent of the world's population live in Africa with an annual rate of increase at 2.8 percent.
The region as a whole is among the poorest and least developed of the world. Partly because of long-standing problems that hampered growth and compounded social problems, because some government policies discouraged individual initiative and entrepreneurship.
Agriculture accounts for about one-third of the continent's total economic output, more than half its export earnings and employs 75 percent of the work force. As a whole agricultural production growth dropped to 1.7 percent in 1997, after bumper crops raised output by 5.2 percent in 1996. On a per-capita basis, less food is produced in Africa today than in 1970, and food imports continue to rise.
Oil, minerals, and natural gases are prevalent all throughout Africa. Despite Africa's great natural resources and energy potentials, industrialization is just getting started. Africa contributes only one percent of the worldwide industrial production.
An overwhelming part of all development aid goes to infrastructure. Some landlocked countries do have good transportation systems. These are the countries whose mineral or agricultural resources were valuable enough to make a heavy investment in transport facilities. The countries that do not have direct access to the sea require road and rail links to a port if they are to engage in trade. Many of these countries are among the poorest in the world, and their lack of transportation facilities and landlocked positions contribute to their poverty.
The definition of infrastructure is an economic investment, such as communications, telecommunications, airports, harbors, roads, schools, hospitals and administrative buildings.
Most African nations gained political independence during the 1960's, yet their economies are still shaped in part by their past experience as European colonies. Under colonialism, the country which owned the colony exported its raw materials to Europe where the raw materials were made into manufactured goods. Some of the goods were then shipped back to the colonies for sale. The same pattern occurs in much of Africa today.
Africa has faced a variety of obstacles to economic growth, many of which are beyond its control. Nearly three-fourths of all African nations are dependent upon one or two exports for the bulk of all foreign exchange earnings. Drops in world prices for many of these commodities and rising prices for imports, have reduced the money available for development. Many governments borrowed heavily to finance prestigious but often economically unviable large-scale projects; the cost of debt service has nearly bankrupted some countries.
There is a new generation of leaders implementing democratic reforms and expanding economic growth. Though economic growth is healthy, political and economic barriers are hindering Africans from reaching their fullest potential and slowing development. While economic aid and humanitarian assistance remain essential tools in coping with Africa's inevitable crises, other methods have been chosen to encourage and support economic and political reforms.
A bill that completely changed the economic relationship between Africa and the United States was the Africa Growth and Opportunity Act. This act granted goods manufactured in Africa duty free access to American markets. It also provided incentives and support for American firms doing business on the continent. This bill provides the platform for Africa's economic transformation into a group of high performance economies.
Nearly 60 percent of the African countries registered rates of economic growth in excess of their population's growth rates, resulting in increased per capita incomes. About half of these
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Economic growth, Economy of Africa, Economy of Swaziland
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