Lessons From Juba...
JUBA, Sudan — To many people here, one of Africa’s biggest boomtowns is already starting to look like a bust. So says the this conclusion aligns with my idea of economic growth. Too many times we have seen this play out in African economies. There is an unexpected boom, and a few sector of the economy take off and suddenly kaboom! There is a burst as a result of other sectors that have not kept up with the economic growth in the leading sectors of the economy.
One may argue the individuals engaging in conspicuous spending in Chinese motor bikes are to blame. That is the conclusion which the Oyinbo' economist will draw. I am not particularly interested in the mechanics of how this happens, because this easily degenerates into debates about minutiae. (One thing I hated about school was spending energy debating about 10 decimal places while kids were dying of hunger on a daily basis...Okay that is story for another day.)
Forgetting that a little raises in income in Juba is equivalent to winning the lottery in any Western economy. What is a brother to do? It isn't really like choosing between yellow corn and white maize is exactly difficult or time consuming.
I have a soft spot for Sudan, but I have an even softer spot for Nigeria. Going by lore told to us by our parents. Isn't this parallel to what happened in Nigeria during the oil boom of the late 70's? Oh! How my dad's eyes lit up when he declared that Leventis (picture Target or Walmart) ran out of goods, because their supply could not keep up with consumer demand.
Why is an amorphous economic growth and a boom in Nigeria particularly scary?
1. What if Nigeria gets it right, so what are we going to do with the new found wealth? What if the FSS2020 achieves its goals?
2. Is the growth in the capital markets and financial services in general necessarily a good thing if the other sectors are lagging so far behind? Isn't that a burst in the making?
Enjoy the NYTimes article;The abundant opportunity for manual labor (skilled jobs are fewer) has put wads
of cash into countless young men’s pockets. But much of it is going toward
beer and motorcycles. Juba’s streets, which were deserted just three years ago,are now crammed with 12-year- olds whizzing around on shiny new motorcycles that their skinny legs can barely hold up. Many of these children end in the so-called Senke ward, at the city’s main hospital, a ward named after the $700 Senke motorcycle (made in China, smuggled in through Congo) that so many unlicensed boys in tank tops and wraparound shades — no helmets, of course — have smashed into trees, cars and each other.
