24 October 2011
More than 50% of African people will live in towns and cities by 2040
Trend will propel African economies to higher growth
More than half of Africa's population will be living in urban areas by 2030 as the continent's economy continues to advance, according to Standard Bank Group (SBG) research analyst Simon Freemantle.
In his latest report looking at trends that are going to propel Africa's growth, Mr Freemantle says by 2050, more than 60% of the 2-billion people expected at the time will be urbanised. This means that 800-million Africans will either migrate to or be born in urban areas in the next four decades.
Mr Freemantle's report is the second in a series of five aimed at unpacking some of the most prominent trends driving Africa's on-going economic and commercial reinvigoration.
He argues that urbanisation will be particularly profound for some African countries such as Nigeria, which he says will see 140-million new urban entrants in the next 40 years. In addition 14 other countries, including South Africa and Angola will be more than 80% urbanised by then.
"Urbanisation is both important and inevitable. If leveraged effectively, and supported by enhanced institutions, the swelling of Africa's large, intermediate and secondary cities can be a profoundly relevant tool in the elevation of socio-economic wellbeing across the continent. African cities will be the pivotal means for the continent to raise productivity, enhance economic output and relevance, and adjust social and economic inequality," Mr Freemantle says.
"The link between economic growth and urbanisation is clear and mutually-enforcing. Firstly, given the benefits of agglomeration and economies of scale, urban-based enterprises are generally more productive, and thus contribute a greater share of GDP, than rural equivalents. African urban household incomes are more than double rural incomes. Urban poverty rates in Africa stand at around 35%, compared to 52% for rural areas," writes Mr Freemantle.
He also notes that urban inhabitants have greater access to basic infrastructure, allowing more fluid commercial gains. Over 70% of urban inhabitants in Africa have access to electricity, he says, compared to 10% of rural inhabitants. Incorporating the full spectrum of household services, urban convergence rates are between 5 and 10 times those in rural areas.
"There is also a clear link between urban and rural prosperity. Cities provide primary markets for agricultural products, generating income that flows back to rural households. Urban concentration supports a more robust development of viable civil societies, enabling mobilisation for economically supportive political and social change," writes Mr Freemantle.
Read the full report here.