SS7E1 The student will analyze different economic systems. SS7E2 The student will explain how voluntary trade benefits buyers and sellers in Africa. SS7E3 The student will describe factors that influence economic growth and examine their presence or absence in Nigeria and South Africa.

 Compare how traditional, command, and market economies answer the economic questions of (1) what to produce, (2) how to produce, and (3) for whom to produce.  Explain how most countries have a mixed economy located on a continuum between pure market and pure command.  Compare and contrast the economic systems in South Africa and Nigeria.  Explain how specialization encourages trade between countries.  Compare and contrast different types of trade barriers, such as tariffs, quotas, and embargos.  Explain why international trade requires a system for exchanging currencies between nations.  Explain the relationship between investment in human capital (education and training) and gross domestic product (GDP).  Explain the relationship between investment in capital (factories, machinery, and technology) and gross domestic product (GDP).  Explain how the distribution of diamonds, gold, uranium, and oil affects the economic development of Africa.  Describe the role of entrepreneurship

 What are the similarities and differences of the economic systems in South Africa and Nigeria?  How does specialization encourage trade between countries?  How do tariffs, quotas, and embargos serve as barriers to trade?  Why does international trade require a system for exchanging currencies between nations?  What is the relationship between investment in human capital (education and training) and gross domestic product (GDP)?  What is the relationship between investment in capital (factories, machinery, and  technology) and gross domestic product (GDP)?  How does the distribution of diamonds, gold, uranium, and oil shape the economies of Africa?  What is the role of entrepreneurship in Africa?

Economic system of Nigeria  The Nigerian economy is a mixed market economy. Their economy thrives on petroleum owned by private companies. The government still controls schools, media and post offices. Nigeria is very poor in health care and the economy as a whole is slowly deteriorating. Nigeria was once a big agricultural nation, but now people have to have food imported.

Economic system of South Africa  South Africa’s economy is a mixed market economy. The government owns some gas and oil companies as well as post offices, media and some health care. The economy thrives on fishing, manufacturing, industry, agriculture and mining. Most whites make most of the income while blacks are poorer, but equality in business is changing. South Africa has the strongest economy south of the Sahara.

 African countries have difficulty trading with each other due to bad roads, roadblocks, searches from border agents among other things  Africa trades outside the continent due to the many resources they have for other countries

Currency in Africa Most countries in Africa that have command or market economies have a system of currency Examples of Currency in Africa South Africa – Rand Nigeria – Naira Democratic Republic of the Congo – Congolese Franc Egypt – Egyptian Pound Kenya – Kenyan Shilling Zimbabwe – American dollar Ghana - Cedi

 Diamonds  Half of the world’s diamonds are in Africa  Botswana, Sierra Leone and DR of the Congo have benefited from the diamond trade  Diamond money is put back into each country’s economy  Some countries have had civil wars over the diamonds

 Gold  South Africa has ½ of the world’s gold reserve  Has a big part in the boosting of its economy ▪ Transportation, media, infrastructure  Ghana has gold reserves, but still needs imports  Mali and Senegal have gold but still remain poor

 Oil  Nigeria is the 6 th largest oil producer in the world  Nigeria is still poor due to the oil being exported and it also causes pollution  Many people from other countries, not Nigerians, work in the oil reserves and for oil companies ▪ China is one of the main countries that takes jobs from Africans

 Uranium  Uranium is important for making weapons and for nuclear fuel  Niger, Gabon, Namibia and South Africa, Botswana and Zambia export Uranium  Uranium’s use is rising due to a search for cleaner nuclear fuel  New jobs and taxes are created due to this element  GDP rises for African countries due to its value

 In Nigeria, banks cannot fund entrepreneurs due to a lack of funds  Investors from other countries are helping to fund entrepreneurs to help Nigeria  South Africa has 2 million small businesses in their country  After apartheid, blacks were given opportunities to get an education on small business start up  Investors are willing to go to South Africa to help out businesspeople