- The population of the cities is projected to almost double by 2030, growing by around 32 million people, according to PWC economists
Cape Town. Africa is expected to have the biggest labour force in the world and experiencing faster economic growth than any other region come 2040, according to a report issued by PwC.
The latest PwC ‘Global Economy Watch’ which puts the spotlight on the largest cities in sub-Saharan Africa projects that it’s the ‘Next 10’ biggest cities in sub-Saharan Africa including Tanzania’s commercial capital, Dar es Salaam that should also be exciting foreign investors.
By 2030 two of the ‘Next 10’ - Dar es Salaam and Luanda - could have bigger populations than London has now, said PWC in a statement citing UN projections.
The population of the cities is projected to almost double by 2030, growing by around 32 million people, according to PWC economists.
“The report projects that economic activity in the ‘Next 10’ cities could grow around $140 billion by 2030. This is roughly equivalent to the current annual output of Hungary,” said Stanley Subramoney, strategy leader of PwC’s South Market Region.
Most major corporations are already active in at least one of the four largest cities in sub-Saharan Africa – Lagos, Kinshasa, Nairobi and Johannesburg.
“In addition to the trends with regard to high rates of GDP growth, rapid urbanisation and the so-called demographic edge that sub-Saharan Africa possesses, a number of other economic phenomena in the region are starting to appeal to the global investment community,” said Dr Roelof Botha, economic advisor to PwC. These include significant new discoveries of mining and energy resources, in particular gold and gas; and substantial investment in infrastructure and capital formation by the private sector, which has witnessed an increase in the ratio of total fixed investment to GDP from 17.7 per cent in 2000 to an estimated 23 per cent in 2013.
Others are sustained growth in per capital incomes, which has led to demand shifts that are benefiting household consumption expenditure on durables, semi-durables and services; and the ability of a growing number of countries to raise financing for infrastructure projects on the international capital market, in particular Kenya and Rwanda.
Both of these countries have recently managed to sell government bonds globally at single-digit yields, which obviate the need for excessive debt servicing costs.
However, there are three problems that could slow the pace at which the ‘Next 10’ biggest cities in sub-Saharan Africa grow, according to the report. (AFP)