African Growth - Forgotten Issues

With economic growth rates at 7%, Africa’s economic outlook is looking rosy. Some argue high commodity prices are the cause, casting doubt about the sustainability of current growth rates. However, there is more to current African growth than high commodity prices. African countries are slowly undergoing structural change, with services an increasingly crucial component of growth (it is easy to forget that half of GDP growth in the past 10 years can be attributed to services directly); better service sectors also lead to growth indirectly by addressing growth constraints on agriculture and manufacturing, improve country-wide productivity and promote a diversified economy. Successful African growth strategies will increasingly rely on appropriate services strategies backed by contextspecific development of institutions and statebusiness relations.