African industry is doing better than previously thought (Economist)

Economist published an article on the status of the manufacturing sector in Africa. Young Africans are optimistic about the future as they turn to manufacturing to create and produce much-needed products. (One man has created inexpensive ventilators to treat COVID-19 and is the recipient of awards for that work). This optimism cuts against established wisdom, where researchers have suggested that the industrialization elevator out of poverty has stalled. New research shows that a long decline in manufacturing’s share of GDP has bottomed out, and it is now about 11%. Output is up by 91% in real terms since 2000. Given numbers such as these, talk of deindustrialization in Africa is “silly,” says Margaret McMillan of Tufts University and IFPRI. According to Xinshen Diao and Mia Ellis, some reasons may be found by looking at which firms have improved, and which have not. In Tanzania and Ethiopia, most of the new factory jobs were created by small, inefficient companies. Although a few big manufacturers have boosted productivity, they have not been hiring much.