Three Billion Africans

How demographics will shape African states' economic and political futures

I: A historically empty continent

For much of history the continent of Africa has been largely underpopulated. For example, it wasn’t until the mid-1990s that the entire region’s population surpassed Europe’s (see below). Now the region is in the middle of a demographic boom that will see its population double over the next 50 years to more than 3 billion. By 2100 half all humans being born will be African. It is not an overstatement to claim that the world’s demographic future is in Africa.

What will a world of 3 billion Africans mean for African economics and politics?

Source: Our World in Data

Underpopulation, especially when one has scant or skewed links to the global economy, is bad for development. There is reason to believe that Africa’s historical (i.e., since the neolithic revolution) low population density partially explains the region’s economic and political underdevelopment.

Of course there were exceptions, with pristine state formation happening in areas that could support high population densities (and associated states) either through agriculture or trade (see below). Evidence suggests that early statehood is correlated with good economic performance — states provide stability, seed and sustain markets and trade, facilitate elite preservation of wealth (i.e. protect property rights), invest and organize human capital, etc. The emergence of strong states is correlated with the presence of inter-state competition.

Very broadly, it helps to have competitor states that focus ruling elites’ minds on the intensive margin of good governance — i.e., making the best use of their people. It follows that states and markets need people to get going. Someone has to work the fields and pay taxes or staff armies and bureaucracies. Finally, state-induced economic and political stability can be a catalyst for population growth, thereby reinforcing the dynamics described above.

Source: Wikipedia

It has taken a long while, but the continent is finally filling up with people. This development will undoubtedly change African countries’ economics and politics. Agricultural land will become scarce. Urbanization will reduce the labor share in agriculture. Higher education attainment will raise citizen expectations while also lowering the costs of mobilization. In the face of macroeconomic and political failures, “exit” (as happened during the 1970s and 1980s) will no longer be a viable option. Increasingly “proletarianized” people who must work to live will demand macroeconomic stability, mass job creation, and social protection from their governments. The rural subsistence safety net for households (and which also doubled up as a political safety valve for ineffective ruling elites) will fade into history.

The net effects of these changes are hard to predict. What we should expect is significant variation across the region. Some countries’ economies will respond to the new pressures by increasing agricultural productivity and boosting mass job creation in urban areas; in addition to investing in essential public goods and services. Others will be overwhelmed by the weight of insatiable demands, and remain stuck in the underdevelopment equilibrium. Many more will be in the middle, experiencing generalized failures in some domains, but also learning to cope or thrive in others.

The effect on politics will also be varied. In some cases, pressure from below will force political liberalization as the only means of resolving emerging policy and distributive concerns. Yet in others, the fear of reforms and desire to protect the economic gains of the last 30 years might produce strong “middle class autocracies.” The widening gap between the promise and realized benefits of electoral democracy in the region leads me to believe that the modal country will be in the latter group.

The distribution of population centers will also matter (see below). Coastal West Africa, the Great Lakes Region (including the rest of the DRC and Tanzania), the Ethiopian Highlands, the wider Nile Delta, and the Mediterranean Coast will pack much of the new population. The pressures described above will therefore be more acute in some countries more than others.

Before proceeding further it is worth noting that the projections that are available from the United Nations and other entities are just that: projections. A number of factors may dampen the rate of population increase in African states over the next few decades. First, the joint effects of significant improvements in women’s education attainment and expansion of service sector jobs (both formal and “informal”) will certainly depress fertility rates.

For example, Kenya’s fertility rate has dropped from 6.7 (1989) to 3.4 (2022). The dramatic shifts in Kenya (see figure below) can easily be replicated in other countries — the key secret is girls’ secondary education. Second, African states are urbanizing fast. While some of the urbanization is actually “ruralization of urban areas” (i.e. subsistence living in urban areas), the shift still has structural implications, including for fertility rates.

All this to say that I think the realized population figures will likely lag current projections. Even then, we’ll be talking differences of perhaps tens of millions of people. Barring a catastrophic plague, by 2070 there will be at least 3 billion Africans.

II: More brains vs more stomachs

Overall, I am optimistic about Africa’s population boom. This is for the simple reason that I see the increase in population not simply as adding new demands (stomachs) to economic and political systems, but as also increasing the sources of potential solutions (brains). I also do not think that the rate of population growth requires any direct policy interventions like happened in China. Education attainment and economic change are the best “fixes” against seemingly unmanageable rates of population growth.

Importantly, the increase in numbers will be accompanied by changes in the population pyramid. The under 15 share of the population is already shrinking, a process that will accelerate over the next decade. Over the next 70 years, the share of the working age population will be increasing. African countries will also have a lot more runway than some Asian countries in avoiding the growing-old-before-getting-rich trap. The relative share of the over 65 population will remain muted (below 10%) for decades. The implied changes in dependency ratios point towards rising per capita income alongside overall population growth.

The policy implication of the above discussion is that all the talk about African “overpopulation” and proposals for direct interventions to reduce fertility rates are misguided. The last thing the region needs is to wake up in 2070 hurtling towards a demographic wall while still crushingly poor. One hopes that China’s looming demographic crisis will disabuse all serious policymakers of such efforts.

There is, however, better promise in economically empowering women and households. Alongside public health interventions that reduce under 5 mortality, investing in quality girls’ education is perhaps the best development policy imaginable. Educated women have children later in life (hence lowering the effective fertility rate). Their children also tend to be healthier and more likely to do well in school and the labor market. Add sustainable economic growth and mass job creation to this mix and you start seeing the dividends of having more brains in the economy.

III: The potential engines of economic takeoff

Where will the growth come from to support 3 billion Africans? One the most vexing economic questions of our time is where the catalyst for Africa’s economic takeoff will come from, especially when it comes to the best known engine of economic change: manufacturing jobs.

One of the ideas often thrown out there is that an aging East Asia will result in factory jobs moving to Africa. However, there are a number of reasons why that might not happen. In much of Africa, labor is still more expensive than in much of Asia — on account of relatively higher food/housing prices and labor power (African labor has a lot more outside options compared to landless proletarianized Asian labor).

Furthermore, increasing productivity in Asia (in part due to automation) will mean that even if African labor became more competitive only a fraction of the jobs would move to African countries. Between 1960-1990s, Asian labor productivity increased by 135% compared to Africa’s meager 27%. Plus it is not like Asia has exhausted its own labor reserves already. Despite the North Atlantic talk of decoupling from China, Asian dominance in manufacturing and related supply chains will continue to crowd in investments. Even if America and its allies really followed through on decoupling from China, the possibility of laundering economic ties through dynamic economies like Vietnam, the Philippines, and Indonesia will ensure the sustained dominance of Asian manufacturing.

It is imperative that African policymakers understand that they cannot bank on being able to simply replace Asian manufacturing. They must muscle their way into traditional manufacturing supply chains AND develop their own domestic markets on the back of rising populations. Here, the trend data looks a tad optimistic. If you squint hard enough, you can see in the image above that manufacturing as a share of GDP is trending upwards in Africa. It is also clear that the nominal output in manufacturing has been increasing since the early 2000s. The decline in manufacturing share is therefore as much a function of the rise of service sector jobs as opposed to erosion of existing manufacturing capacity.

Source: Macrotrends

The key missing link to African economic takeoff is agriculture. From Thandika Mkandawire to David Ndii and everyone in-between, African economists have for a long time — without much success — insisted that states in the region should pay serious attention to agricultural productivity. Boosting agricultural productivity would not only solve the problem of feeding 3 billion stomachs, but also lower the effective cost of labor (through downward pressures on food prices) thereby making African labor globally competitive; boost agro-processing as a step towards manufacturing; and enable high returns to public sector investments.

Given the menu of options available, urbanization and intra-Africa trade present the best possible ingredients for economic takeoff. Ongoing urbanization will create a market for agricultural products. The same urban populations will be a ready market for fast-moving consumer goods.

This is where intra-Africa trade, as envisioned by the African Continental Free Trade Agreement (AfCFTA) comes in. As the African Union works on boosting trade among its members, it should also cultivate and jealously guard its markets by all means necessary. Access to the growing African markets should come with built-in reciprocity that ensures that trade doesn’t become a matter of exporting jobs without a care for African workers. This should be a priority even if it means suppressing some margin of consumption of imports in the medium term. As the current decoupling debate illustrates, there is nothing inherently natural about global supply chains. They are largely the product of geopolitics and deliberate economic policies.

Finally, African policymakers should see the process of urbanization as an opportunity to improve human capital in the region. While the standard view of human capital improvements focuses on education and skills acquisition, policymakers should expand their approach to include the cultivation of well-ordered urban communities. This means doing all that is feasible to avoid the phenomenon of ruralization of cities. Already, the majority of urbanites in Africa live in what can be classified as “slums.” Consequently, human development outcomes at the margins of cities are often not that much different from rural areas. Without a deliberate attempt to avoid this outcome, urbanization in the region will not yield the implied dividends of Africa’s demographic boom.

IV: Is the world ready for 3 billion Africans?

I have previously argued that Africa’s demographic alone means that the region can longer be presumed to be at the bottom of the geopolitical totem pole. Just to put a finer point on it, at current immigration rates a world of 3 billion Africans means that African nationals living outside the region will approach 43 million. The real number will actually be higher since outmigration increases with rising incomes. This is without counting the region’s already robust diaspora in the Americas, Europe, and the Middle East.

Whether demographic pressures result in better governance and higher prosperity or worsening deprivation under autocracy will not matter. Ever more Africans will migrate out of the region for work, travel, or to escape poverty.

In the end, though, what will really matter is whether African governments will be ready for 3 billion Africans. At a minimum, one hopes that pressures from below will forge much better leaders like we haven’t seen since the decolonization era.