RIVERSIDE, CALIFORNIA – The eurozone crisis is taking a toll on its citizens: low growth, soaring unemployment, and tough austerity measures, with no relief in sight. The likely adjustment of Europe’s fiscal strategy offers a glimmer of hope, but it does not address the challenge of restoring long-term growth.
One solution that Europe’s leaders should pursue is to develop strategic partnerships with African governments aimed at increasing exports. A developed Africa can open up new export markets for the West’s saturated and stagnant economies, and help to revive global growth. Indeed, Europe should be laying the groundwork for African countries to absorb its exports for the next 50 years.
According to global business consultant Vijay Mahajan, “50-150 million Africans are classified as economic elites with spending power similar to working-class citizens in the West,” and an additional 350-500 million Africans live in households with stable jobs. Moreover, the McKinsey Global Institute reports that Africa boasts a robust and growing consumer class, with a combined spending power of over $800 billion.
That number is expected to reach $1.4 trillion by 2020, and the continent’s population is expected to exceed two billion by 2050. This powerful consumer base will demand the products – such as housing, appliances, automobiles, and computers – that European consumers demanded over the last 50 years.