THE BRICS IN AFRICA: RECONFIGURATION OR RE-ESCALATION OF DEPENDENCY?

• Expansion of infrastructure, growth in BRICS’s manufacturing sectors and a greater demand for food led to an increase in commodity prices

This boom in commodity prices lasted nearly 10 years and drove the “Africa Rising” narrative

WHAT DID “AFRICA RISING” DO? • Prowess in manufacturing led to price competition in industrial goods - good for African consumers - bad for African manufacturers Share of manufacturing in Africa’s GDP - 15% in 1990  now 10%

The African Transformation Report looks at “ACET 15” (Senegal, Burkina Faso, Ghana, and Nigeria, Ethiopia, Kenya, Uganda, Tanzania, and Rwanda, Cameroon, Zambia, Botswana, South Africa, Mozambique, and Mauritius) These countries comprise (of SSA): 70% of SSA population 76% of GDP 85% of manufacturing value added 80% of exports Plus “Early Transformers” (Brazil, Chile, Indonesia, Malaysia, Singapore, South Korea, Thailand, and Vietnam)

DIVERSIFYING DEPENDENCY? • Oil-exporting countries have grown > 300% faster than non-oil exporting countries Average index of export diversification in SSA is 2.2 (0 = perfectly low; 100 = perfectly high) • Exports to the 3 large emerging markets (Brazil, China, and India) were dominated by natural resources, particularly oil = 70% of all African exports to the three countries

And when the party’s over……? 2014 2020 2025 Energy 119.6 105.3 97.2 PRICE INDICES IN REAL 2010 US$   2014 2020 2025 Energy 119.6 105.3 97.2 Non-energy commodities 92.6 85.4 79.2 - Agriculture 96.8 88.1 81.0 - Beverages 77.4 71.3 66.2 Food 103.3 90.5 81.2 - Fats and oils 101.4 78.8 - Grains 115.1 100.5 89.9 - Other food 95.3 84.6 76.5 Raw materials 90.7 91.0 88.2 - Timber 100.4 105.2 104.5 - Other raw materials 80.1 75.4 70.4 Fertilizers 88.0 77.3 Metals and minerals (a) 82.9 79.5 75.5 Base metals (b) 82.3 74.9 Precious metals 102.2 92.2 83.9

World Bank scenarios for African growth assuming slowdown in BRICS (with average per capita growth rate at 2.3% between 2015-25)

Questions?