"In Economics, the Majority is Always Wrong" Stories of Africa's economic boom rest on shaky foundations. John Kenneth Galbraith can help.
Think Africa Press | 18 August 2014
This US-Africa Leaders Summit,
held at the start of this month, fell at a time of rising concern over
the sustainability of Africa’s economic emergence. In particular, many
watch with excitement, as well as anxiety,
at the ravenous investor interest in African debt and in new joint
ventures that aim to serve the continent’s consumers. The boom in
investment has been so striking of late that these flows could soon be
Africa’s leading source of hard currency.
However, while these
trends continue to inspire hope in some quarters, in many other circles
faith in the idea that this capital surge will generate full employment,
reduce inequality and eradicate poverty is waning. Instead, various
commentators now worry about overheating, overreach, resource
misallocation and non-performance. Meanwhile, stories such as
excessively-indebted Ghana’s recent expression of interest in subjecting
itself to another course of International Monetary Fund (IMF) medicine
provide further fodder to those that emphasise the potential for bubble
trouble south of the Sahara.
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