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The three most important challenges and opportunities for the decade ahead

Shanta Devarajan's picture

 1. Jobs

Throughout the developing world, productive-employment-intensive growth remains a challenge. In Africa, it is almost a crisis, with most of the labor force working in low-productivity, informal-sector jobs, and 7-10 million young people entering the labor force every year. That the unemployment rate in South Africa—the continent’s largest economy—has remained around 25 percent is particularly troubling.

2. Fragile states

One group of African countries—numbering 20 at last count—are missing out on development because of conflict, war or serious governance problems. Even more disturbing is the fact that these countries have remained fragile states for a long time: The probability that a fragile state in 2000 was still fragile in 2008 is 0.96. The development community needs to rethink its approach to these countries.

3. Politics and pro-poor reforms

After one or two decades of multi-party democracy in some countries and the increased voice of domestic civil society (thanks partly to the information revolution), the climate for pro-poor reforms in Africa is improving. Note the almost total absence of populist (and ultimately anti-poor) policies such as price and exchange rate controls in response to the food, fuel and financial crises of the past two years. As policymakers are increasingly being held accountable by the people—the majority of whom are poor—there is a better chance that they will take decisions that benefit the poor.

Comments

Good post Shanta. Another challenge that really needs to be addressed this decade before it becomes a serious problem is urbanization. The process of urbanization itself is not a problem, a lot of productivity is in the urban areas, however many cities are not gearing up for those flocking to the urban areas. You mention jobs as a challenge for the decade, with fewer jobs and increased migration to urban areas, this is a potential ticking bomb. There are unplanned settlements that will place increased pressure on existing utilities. If those moving the city aren't placed in planned settlements where resources can be managed better, cost of living in cities and service delivery is likely to be severely affected. This has to be addressed this decade, before it becomes a serious impediment to growth and quality of life in urban areas in Africa.

Many thanks Shanta for this very interesting post, I think the climate change is another challenge to be adressed. Everybody knows that Africa's responsibility in the ecosystem degradation is one of the least significant compared to other regions across the globe. Actually, Africa is one of the most vulnerable continent to the climate changes. Recurrent cycles of droughts and floods are affecting millions lives on the African continent. The recent food crisis that hiited the continent has given us lessons that tensions such as social conflicts, disorders, political instability, as well as pressure on public finances are expected to be likely the real concern. The end of the Kyoto protocol and the insignificant outcome of Climate Change Wolrd summit organized last month in Copenhagen are also a real threat for Africa's developpment during the ongoing decade.

Submitted by ivo njosa on
If there were only one area that I could put all development resources into, it would be in the implementation of real accountability. True accountability will spur competition that will in turn improve results--- or at least provide results that could be further analysed. At this time, very few developing countries have meaningful accountability. Real efforts and innovation are implicitly discouraged, forcing competent candidates to move away from government. One keeps hoping that we would get leaders who will do the "right thing". But I say that, we must instead put systems in place that forces all leaders to do the right thing. Without this accountability, I see development increasing at snail's pace. I would take real government accountability over all the development money any time.

Submitted by Charles Chuka on
I very much share Ivo Njosa's emphasis on accountability. As Shanta notes, some progress is being made, and I dare say thanks to progress in education and openness to increasingly vocal NGOs. Deepening democracy accounts for much of this progress. However, where it is not underpinned adequately by strong institutions, the democratization process remains fragile and so is the accountability we have witnessed todate. Because of the need to balance competing demands in new democracies, the public sector is inherintly slow in building institutions. I very much subbscribe to the view that further progress in accountability will hinge on strengthening the demand side. To the extent that they are increasingly being locally funded and thereby acquiring grass-roots legitimacy, NGOs have been a good start. So are efforts to incorporate in projects capacity building for strengthening the demad-side for accountability. But I think new thinking is needed to increase the number of businessmen in the private sector, which in many African countries remain the most significant tax payers, and could provide the most effective demand for accountability. Despite the many efforts in this regard, I think that interventions remain timid and resources are wasted. That's a bit presumptuous on my part, but I do believe much more can be achieved if a large proportion of available resources is allocated to elimating more substantive than imaginary private sector bottlenecks.

Submitted by Fernando on
Why FIFA choose Africa to have the World Cup, when that continent has several issues mainly causes by Europe and America, the eyes of the world are going to be in South Africa, the worst masacres of humand kind are in that part of the world, and noone cares, but now we are goint to celebrate soccer. Children working like slaves seeding cacao so we can have nice chocolates?, sexual expoitation from rich guys from Europe And US. Let's pretend Africa has a reason to celebrate, good job FIFA, good job world.

Submitted by MarkRight on
Nice blog as for me. I'd like to read more concerning this topic. Thnx for giving that info.

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