Opinion
Africa: Explaining the rapidly expanding middle class
By ditching state controls and embracing private sector-led policies, African economies stimulated the growth of the middle class, and there is room for further expansion with more public sector investments in infrastructure projects, Bategeka said.
In the 1990s African economies embraced the World Bank and the International Monetary Fund (IMF)’s structural adjustment programs, which advocated free market policies.
“The onset of liberalization, which focused on private sector-led growth, is key to the growing middle class on the continent,” added Bategeka. “Countries introduced sound economic policies which controlled inflation, benefiting investments in their economies.”
North African countries have a higher concentration of middle class society, with Tunisia having the highest proportion at 89.5 percent, followed by Morocco with 84.6 percent.
Liberia has the lowest concentration of middle class among the countries surveyed, with only 4.8 percent of the population falling into this category, followed by Burundi at 5.3 percent.
“Africa’s middle class is a key source for private sector growth on the continent, accounting for much of the effective demand for goods and services supplied by the private sector,” according to the African Development Bank.
Sub-Saharan Africa remains insulated from the negative factors affecting growth in developed countries and the economic activity in the region is generally robust with growth in 2012-2013 expected to remain the same as it was a year earlier, the IMF said in its October 2012 regional outlook for sub-Saharan Africa.
This article first appeared in The East African
