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AFRICA MACRO

ANALYSIS AND STRATEGY

% of Total World Population 50% 45% 40% 35% 30% 25% 20% 15% 10% 5% 0% Africa

Brazil

China 2050

Europe

India Indonesia Pakistan

US

2011

Rest of the world

Source: Joab’s Technologies and Research. Capital Joab’s Technologies and Research.

Given the expected sharp increase in population and the rapid growth of the economy, Africa’s continued emergence from poverty could have as profound an impact on the global economy as the rapid pace of China’s and India’s expansion in terms of increasing demand for raw materials, providing a market for consumer goods, fueling growth of the financial sector and boosting demand for energy. Africa’s population is presently 78.7% of China’s. By 2050, when India is projected to have more people than China, Africa’s population is projected to be 74.2% larger than China’s and 37.1% above that of India’s. This is clearly an enormous potential market to be tapped.

Urbanization Most Africans still reside in rural areas but that is rapidly changing. In 2000, 36% of the population lived in urban areas but by 2010 that ratio had increased to 40.0% and by 2050 the UN expects 58.7% of the population will live in cities. As of 2010, there were 50 cities in Africa that had a population of one million or more. By 2025, the UN predicts there will be 81 cities that will have a population of one million or more.

Unlike in many developed countries, Africa’s demographics are skewed towards a burgeoning population of young people. Using Nigeria, the most populous African country, as an example, the US Census Bureau estimates that 54.3% of the population is under nineteen and just three percent is 65 and over. By contrast, in the US, 26.9 percent of the population is 19 and under and 13.2 percent is 65 and over. According to the Population Reference Bureau, “Africa has the fastest-growing and most youthful population in the world…over 40 percent of Africa's population is under 15 years of age.” This young population will create a tidal wave of consumers in the near future who like their Asian and Latin American counterparts will want to spend their disposal income on goods and services that improves their living standards. This will clearly benefit many sectors of the economy such as retail, restaurants, travel, automobiles, electrical appliances, furniture and clothing.

Joab’s Technologies and Research, Natu Court Flat B.

The urbanization of Africa will present many challenges. Housing will be one of the most important. It is already inadequate in Sub-Saharan Africa as 71.9% of the urban Page 20 of 104

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