Sub-Saharan Africa by the numbers

The phrase "Asian Century" has become a cliché. This, it is said, is the century in which "Asia" will eclipse "the West."

Whether it comes to pass or not, there is no question that the rise of Asia as a hub of economic growth has been remarkable. In 1960 the idea that an American high tech company, Apple, would employ a Taiwanese company, Foxconn, to assemble an iconic consumer product, the iPhone, from components manufactured by (among others) a Korean company, Samsung, in a mainland Chinese factory, would have sounded like a fairy tale. Fifty years later it seems normal. Asia may or may not eclipse the West but it has arrived as a major force.

So, back in 1960, was there any way of predicting the rise of Asia?

In 1960 most of the world's economic activity was concentrated in North America, Western Europe and Japan. The Soviet bloc was not really part of the global trading system. To an extent that seems unbelievable now, China and India were both quite isolated.

The outstanding feature of both Asia and Africa, especially sub-Saharan Africa, was poverty and technological backwardness. If anything, Africa's prospects seemed a little better than Asia's. The infrastructure was better and, a legacy of the colonial era, they had better links with global trade. Except for the Mao worshippers of that era few people thought in terms of an Asian rise.

So what happened?

To demonstrate what happened I sought a single statistic that best encapsulates a country's progress, or lack thereof, over a 50 year period. After trying various measures I came up with the relative progress indicator, or RPI: per capita GDP as a percentage of US per capita GDP expressed in current dollars

Here's why I think RPI is a reasonable measure. In 1960 the US had by far the world's most productive economy. It also had the greatest GDP per capita of any significant country on Earth. Any poor country that was making progress should see its RPI increase for two reasons:

--Starting from a low base, its per capita GDP should grow faster than the US; and

--As its productivity improved, its currency should appreciate relative to the US dollar.

I readily admit that RPI is a rough and ready measure subject to huge error bands. China, for instance, is a notorious currency manipulator. Its real RPI is greater than what is shown below because it tries to keep the value of the remnimbi down.

Nonetheless, as an indicator of trends over a long period, I think RPI does the job.

Here we have RPI for selected countries for the years 1960, 1980, 2000 and 2010:

(Calculated from World Bank Economic Indicators)

If we look at China's entry, the number "3.2" in the 1960 column means that in 1960 per capita GDP in China, as calculated using 1960 exchange rates and dollars, was 3.2% of America's.

We see that China lost ground relative to the US between 1960 and 1980. Those were the years of catastrophic Maoist rule which included the "Cultural Revolution."

Deng Xiaoping's reform started in the late 1970s and between 1980 and 2010 China advanced rapidly relative to the USA. The 2010 figure of 9.5 is almost certainly an under-estimate since China has followed a policy of keeping its currency under-valued.

This is encouraging. It shows our RPI is a good indicator of trends at least as far as China is concerned.

All countries in the region labelled SE Asia & Pacific with the exception of the Philippines advanced relative to the US in the period 1980 – 2010 albeit some had a few ups and downs along the way. Again, this is broadly what we expect to find.

South Asia is more of a mixed bag with Bangladesh and Pakistan actually losing ground relative to the US between 1980 and 2010.

Now look at Sub-Saharan Africa. Every country in the table for which data is available, with the exception of Uganda, lost ground against the USA between 1980 and 2010. However for most of them the worst seems to have been over by 2000. They made up some lost ground between 2000 and 2010 thanks largely to the commodities boom.

However, here is the real shocker. Look at the column labelled 1960. The Democratic Republic of Congo, Ghana, Kenya, Zambia and Zimbabwe were all somewhat ahead of China and Korea. Starting from roughly equal baselines in 1960 with, if anything, a slight advantage for the African countries, sub-Saharan Africa and South East Asia follow radically different trajectories. This is true no matter what metric you use. You may add or subtract countries from the table. You may use different metrics. From 1960 onwards South-East Asia pulls ahead of sub-Saharan Africa and keeps on going.

Note Angola's performance. Its RPI increased almost five-fold between 2000 and 2010. This is almost entirely due to an increase in oil production and a fortuitous rise in oil prices. Around 85% of Angola's GDP is oil-related.

To put this in perspective, Angola exports almost as much oil as Nigeria but has only about one tenth the population. However the Angolan oil boom, while it has made a small privileged class wealthy, has done little to benefit the general populace. The broad-based advance seen in SE Asian economies is absent from Angola.

Of course GDP in current dollars does not tell you much about how well-off people are. Price levels vary from country to country. I remember how shocked I was when I translated the price of fruit and vegetable in Australia into South African rand.

Here we see per capita GDP on a "purchasing power parity" or PPP basis for the same countries.

(Source: CIA World Factbook)

As we can see the countries that did well using our RPI are richer, on average, than those that did poorly. We also see that South Africa and, to a lesser extent Angola, excepted, sub-Saharan Africa is now much poorer than SE Asia.

Leaving out the special case of South Africa, only one sub-Saharan African country, Angola, thanks to its oil windfall, is in the same class as even the poorer SE Asian countries. And remember, back in 1960, Africa was by some measures a bit richer than SE Asia.

Compare, for the moment, Angola and Indonesia. In terms of per capita GDP Angola appears richer than Indonesia. But 40% of Angolan households live below the poverty line compared to 14% of Indonesian households. Both countries, of course, are still struggling with poverty but the benefits of growth in Indonesia have been more evenly spread than in Angola. In fact Angola is a more unequal society than the much poorer Ghana. This is typical of countries that get rich quickly due to a minerals boom. Wealth gets concentrated in very few hands.

Here are some more statistics about sub-Saharan Africa.

· The region is home to 13 of the world's 20 poorest countries as measured by purchasing power adjusted, per capita GDP

· 15 of the 20 countries with the highest total fertility rates are to be found in the region. With an average of 4.9 children per woman the sub-Saharan African population is exploding. Increased numbers could wipe out economic gains

· 17 of the world's 20 countries with the highest rates of illiteracy are in sub-Saharan Africa. In some ways I think this is the worst statistic of them all.

In short, despite recent gains, sub-Saharan Africa is desperately poor both economically and in terms of its human capital.

In addition, sub-Saharan Africa has seen some of the bloodiest conflicts and massacres since the end of World War 2.

If we look at the rise of SE Asia there is a common theme that may be expressed with one word: manufacturing. To an extent never before seen in history SE Asian countries made use of disciplined, low wage labour forces to become manufacturing hubs.

The paths these various countries followed are quite different. Indonesia, blessed with vast natural resources, did not follow the same path as South Korea which, in turn, did things differently to China. But almost all the SE Asian countries emphasised manufacturing in one form or another and to one degree or another.

And that is the main reason the SE Asian countries advanced on a broad front, offering employment to, quite literally, a few hundred million people, while Angola has not.

I do not think this path is open to Africa. Manufacturing technology has moved on. It will never again be a source of mass-employment. The SE Asian countries are going to have to find different jobs for future generations as is the case in the industrialised West.

In the future, manufacturing will be like agriculture. It will remain important but few people will work in factories.

To put it bluntly, I think Africa missed the boat on this one.

And at this point I have to say that I do not see a path forward for most people in sub-Saharan Africa. I think the commodities boom will make a relatively small elite wealthy. But I fear the majority of the people of sub-Saharan Africa will continue to eke out an existence that is barely above subsistence level for the foreseeable future.

But, then again, most people said that about Asia in 1960. And in many parts of Asia, especially on the Indian sub-continent, that is still true.

Why did sub-Saharan Africa and SE Asia follow such different paths? Everyone has theories ranging from "it's all the fault of the colonialists" to "Africans are stupid."

I'll leave the last word to Mamphele Ramphele, former vice chancellor of my alma mater, the University of Cape Town.

Mamphela Ramphele lashed out at South Africa's education system

South Africa's education system is worse today than the "gutter education" the country had under the apartheid government, said an academic and struggle heroine Mamphela Ramphele, The Star reported on Friday.

"Maths literacy… what is that? It's worse than the arithmetic I did under Bantu education," Ramphele was quoted saying.

She was addressing the sixth annual Solomon Mahlangu lecture at the University of Johannesburg.

Ramphele criticised the much praised matric pass rate saying it was deceptive, consigning thousands to a life that promised neither further education nor employment.

She lashed out at the 30 percent pass benchmark, saying it degraded education standards and was used for political purposes.

"Kader Asmal [former education minister] fell for micropolitics when, under his watch, a 40 percent pass rate suddenly became 70 percent."

Ramphele also criticised the 70.2 percent pass rate achieved by last year's matriculants.

"There was a great razzmatazz about the 'historic' 70.2 percent, but this performance was deceptive-less than 500,000 people showed up to write their matric exams; 539,102 students [who were in grade 1, 12 years prior] disappeared from the system. The department of education must tell us what happened to those children."-Sapa