The global recession that isn’t

Paul Raven @ 14-12-2010

You can’t turn a page or click a tab here in the UK without reading about the ongoing woes of the global recession, and I rather suspect the situation is similar for Stateside readers.

Thing is, the global recession isn’t quite so global as it looks from our standpoint in the “developed” West; via Tobias Buckell, here’s a piece at Foreign Policy that paints the nations of Africa as a golden investment opportunity – a far cry from the war-scarred deserts and shanty-towns of popular perception.

Africa, in fact, is now one of the world’s fastest-growing economic regions. Between 2000 and 2008, the continent’s collective GDP grew at 4.9 percent per year — twice as fast as in the preceding two decades. By 2008, that put Africa’s economic output at $1.6 trillion, roughly on par with Russia and Brazil. Africa was one of only two regions — Asia being the other — where GDP rose during 2009’s global recession. And revenues from natural resources, the old foundation of Africa’s economy, directly accounted for just 24 percent of growth during the last decade; the rest came from other booming sectors, such as finance, retail, agriculture, and telecommunications. Not every country in Africa is resource rich, yet GDP growth accelerated almost everywhere.

Toby goes on to do some back-of-the-envelope maths:

The world population is estimated to be 6.7 Billion.

Asia and India, both currently in growth patterns, represent 60% of the world’s population. Africa represents 15%. So 75% of the world is actually right now currently growing.

However most of Western Europe, parts of North America, and parts of South America are not. So it’s a global lack of growth for 25% of the world’s population.

There’s no denying that things are looking pretty grim economically for us Euros and Yanks, and that our problems are having a knock-on effect elsewhere. But rather than a global recession, perhaps what we’re seeing is simply a globe that doesn’t spin around us as the pivot point any more. Cold comfort for the myopic, I suppose, but I’m kind of relieved; we’ve had our time in the sun, but the sun hasn’t stopped shining just yet.

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4 Responses to “The global recession that isn’t”

  1. Wintermute says:

    …However, if you take into account the fact that China and needs to grow its GDP at 6% *just* to keep up at the rate that people are moving from rural areas to cities, and that many of these emerging market or pseudo-emerging markets have the same issue, it’s puts a bit of a desaturation filter on the green grass on the other side of the fence.

    And in truth, much of the “growth” of the past few decades, and especially the noughties has not been actual economic growth but pumping of debt and imaginary money, so we’ve really been in a recession for a long time, it’s just more obvious now.

    On a very general and macro scale, this is the idea of grow-forever capitalism slamming up against the windshield of reality. Unless you start producing more real value through new tech or innovation or a more skilled workforce, you can’t grow in any sustainable way, and certainly not at ludicrous rates like 20% per year in the housing sector.

  2. Athena Andreadis says:

    Victorian England also grew apace, with such lovely social customs as child labor and no workplace or environmental protection (as in: coal mines). Political and ecological conditions in China and much of Africa are horrific. If GDP is the sole metric of success, we are dooming large sections of humanity to inhumane living. One problem with this recession is that it has pushed aside the question of (yes, global) human rights. Whether “the West” has had its day in the sun is irrelevant — the enlightened values are what matter.

  3. Wintermute says:

    We need to use different metrics. Instead of GDP, GDH – Gross Domestic Happiness. WD – Wealth Distribution. ALS – Average Living Standard. BP ratio – Billionaires to poverty ratio.

  4. Babylon says:

    I wonder if Europeans and Americans are going to start emigrating to Africa and Asia? I know that if I were going to I’d pick India.