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Kenya rising and Germany falling: A tale of two populations

Wolfgang Fengler's picture

Today, October 31, 2011 our planet reaches a new milestone: we are 7 billion people on earth.

In the past, when the world’s population was a fraction of what it is today, the expansion of humanity was a source of alarm and many apocalyptic tales. More than 200 years ago, Thomas Malthus, one of the leading scholars and economists at that time predicted that the world would simply run out of food. Then, we were less than one billion people.

Now I want to take you on a journey into the future. Demography is a great ‘time machine' because demographers’ predictions have been surprisingly accurate. At a global level, rapid population growth is here to stay, partly because those who will be driving future growth (tomorrow’s moms and dads) have already been born. By 2025, the world will already have crossed the 8 billion mark, and a billion more will have been added by 2044. However, the factors behind future population growth will be fundamentally different, and the trend will vary across continents. In the past, population growth was mainly due to increasing numbers of children. Today, fertility is declining but we are still growing, for two reasons. People are living longer.  And thanks to the previous population boom and higher survival rates, there are many more young families having (albeit fewer) kids.

Africa and Europe are at the two extremes of the big geographic shift. Africa, the fastest growing continent, will almost double its population – from some 900 million today to almost 1.8 billion – by 2050. Then the continent will be home to more than 20% of the world’s population, up from 10 percent in 1970 and 15 percent today. By contrast, Europe will dramatically lose its population share. As the ‘old continent’ struggles to maintain a population at the current level of 500 million (albeit ever older than today), Europeans will see their share decline from 18 percent in 1970 to 8 percent by 2030.

These big demographic shifts give me an opportunity to compare two of the countries I know best: my home country Germany and my country of residence Kenya. When I was born in 1971, Germany had 7-times more people than Kenya: 78 Million Germans (who lived in two countries at that time) versus 11 Million Kenyans. Today, Germany is only twice Kenya’s size – 82 million compared 41 million. By 2040, both countries will have approximately 74.5 million people. From then on, Kenya will probably remain forever larger than my home country, but not necessarily richer, even though the gap in living standards is likely to narrow.

How is it possible that Kenya will catch up so quickly?

Kenya mirrors Africa’s population growth. The population has doubled over the last 25 years, to about 41 million people, and rapid population growth is set to continue. Kenya’s population will grow by around 1 million per year – 3,000 people every day – and reaching about 75 million by 2040.
 
Germany is among a group of 19 countries that are actually expected to shrink. Japan and Russia are the only other major economies with the same fate –– but Germany is shrinking faster (it’s ranked 8th in the list of “shrinkers”, with Japan and Russia 14th and 15th  respectively). Most of the other countries in this category are in Eastern and Central Europe (top of the league is Georgia shrinking by 1% every year, followed by Moldova and Lithuania).

The contrast is even more dramatic if we focus on the working age populations (defined as those between 16 and 64 years old). Today, Kenya has 22 million.  By 2040, this figure will have more than doubled to 50 million, which means that adults – not children – will account for the bulk of Kenya’s population growth. Germany by contrast will travel in the opposite direction: from 54 million today (out of which 40 million actually are in employment) to 41 million by 2040. By the time Kenya’s babies become adults, 20 or so years from today, your country will have a larger workforce than mine (see figure).

Figure: In some 20 years, Kenya will have a larger workforce than Germany (click on it to see it larger)

Projections by the World Bank demographic team based on UN Population Prospectus 2010

Kenya’s future pattern of population growth can be a force of good.  More people on the same space will translate into higher urbanization, which tends to create more economic opportunities. If people live longer and have fewer children, they earn more and can invest more per child. A large urbanized and well-educated population tends to generate a strong middle class and a vibrant private sector. As a result, economic development may be easier to achieve and sustain–though it is not guaranteed.  If Kenya wants to reap the benefits of this demographic dividend, fertility will have to decline further, ideally below three children per family. This is already the case in cities, but not in rural areas (where it remains at five children). The country also needs to provide services (roads, rail, schools, hospitals) to a rapidly growing and urbanizing country on a much larger scale.
 
Kenya and Germany face opposite challenges: one country has too many, the other too few youth. Germany is already facing a lack of skilled labor, while Kenya will soon have an abundance of it. The win-win solution is allowing more Kenyans to migrate to Germany which could benefit both economies, especially if Kenyans continue to send remittances back home.

Comments

Submitted by Simon on
very interesting. As per my understanding increase in population translates to decrease in the resources available. Kenya now is facing the crisis of managing its resources as we can see from destruction of forests, water catchment areas. issues of land fragmentation also reduces the agriculture capacity of Kenya. I agree that the extra labor force is beneficial as long as the other factors of production are available and in this case land will be the constraint. As for me i would encourage the government to control the population growth rates no to reach the predicted levels.

Submitted by OLUGBENGA ADESANYA on
The economic pressure would lie on Africa as early as 2030 unless actions are taken now to address the issues.

What will be the ultimate test for Kenya is to harness the power of this workforce without destroying the very environment on which the country is inextricably (and necessarily) tied. The foundational role of the environment in providing Ecosystem Goods and Services to cater to this growing population is essential. Kenya's environmental governance will ultimately have a massive part to play as so much of the current economy is directly dependent on the health of an environment which attracts billions in tourism revenues as well as billions more in Ecosystem Goods and Services. With global climate change likely to impact the availability of basics such as water and agricultural land, in tandem with the population growth, the role of environmental governance becomes all the more important in harnessing this opportunity.

Submitted by Stephanie T on
Kenya is facing a dire economic situation. The Kenyan Shilling has sunk in value, and will continue to do so while the country imports vastly more than it exports. Kenya must take hold of the Industrial reins and find ways to support manufacturing industries on their own lands. Doing so now would lay the foundation for the incredibly large workforce they will have in 2040, while also providing jobs and boosting their economy today. Will Kibaki lead his country in that direction? Or will a new leader arise who will? In 2012, Kenya elects its next President. Citizens! demand that your leadership capitalize on this population growth in a way that successfully develops your country's future and brings you more prosperous lives!

Submitted by Stephanie T on
Here is a thorough discussion in Development Policy Review that "provides a practical procedure to identify and facilitate growth through a sixstep procedure" - ie. the Role of the State in the Dynamics of Structural Change, and in facilitating private sector growth. http://onlinelibrary.wiley.com/doi/10.1111/j.1467-7679.2011.00534.x/abstract

Submitted by Babra on
Kenya has been exporting labour, skilled and unskilled, to many parts of the world - whether in East Africa, Europe or North America. While Germany has been importing labour, it would seem it certainly could do with more. However neither counrty's population or labour pressures can be addressed by emigration alone. Kenya's growing young population will put pressure on resources no matter how much labour is exported. Aas has been noted Governance and Justice is key; without accountability precious resources will increasingly be managed for the benefit of the few. While in Germany (and Europe as a whole) as world markets become more competitive in the face of BRIC growth, Germany will need German speaking labour willing to do unskilled and skilled work. Kenyans should start learning German, and Germans should promote more the learning of German in Kenya as a means to emigration. For language is a key to greater acceptance and understanding in a foreign land; and in Germany for a skilled worker or professional it is a must. The real adjustment would be for more Kenyans to attend university in Germany, as the traditionl preference for the US and UK will have less relative value.

Submitted by Stephanie T on
As Germany is leading the way in embracing and producing green/solar technologies, and Kenya (as with many African countries) harbors great potential for housing such technologies (and supplying power to Europe), I would especially like to see a heightened focus on partnership between the two countries in that arena.

Submitted by Wolfgang on
Stephanie, I couldn't agree more and with an additioanl scale-up of Kenya's "green energy", especially geo-thermal, it will also help reduce oil imports which is partly behind recent economci challenges (see other blog post). Wolfgang

Submitted by Wolfgang on
Thanks much Babra, it would be great if Kenyans learned more German and go to Germany - and vice versa. My wife is actually a German teacher and is trying to help out. Wolfgang

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