Saturday 22 October 2016

Africa's prosperity is in the best interests of western nations

Published 20/08/2015 | 02:30

Crowds throng to a job hiring conference in Beijing. Even a fraction of Asian investment would boost economy
Crowds throng to a job hiring conference in Beijing. Even a fraction of Asian investment would boost economy

For every 1,600 human beings alive on the planet, only one is resident in Ireland. That figure illustrates just how small a part of the world's total population we in this country make up.

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Even if Ireland continues to record rates of population growth higher than the rich-world average in the decades to come, we are set to become even less globally significant, according to new projections by the UN.

As the accompanying chart shows, the west has been in relative demographic decline for a long time and the rest are accounting for ever more of the planet's population.

In 1900, for instance, at a time when Europe's global dominance was at its height, one quarter of humanity was European. Now it is one tenth. By century's end it will be one twentieth.

Although demography is not destiny, it counts for a great deal. Before looking at some of the implications for Ireland of the latest UN projections - notably, the rise of Asia and Africa's on-going population explosion - consider some of the main findings.

The Earth's population now stands at 7.3 billion, a doubling since 1960. Incredibly, a billion people have been added since 2003 alone.

And the growth continues. Next year, for example, it is projected that 83 million people - a number equivalent to the population of Germany - will be added to the world's total.

For the rest of the century, the UN's central forecast predicts that world population will pass the 10 billion threshold in the 2050s and keep on rising.

The enormous increase in the number of people crammed on to the planet gives cause for concern: more people may mean fewer resources to go around.

Yet big improvements in agriculture, medicine and technology in the last century have made existing resources go much further, thereby accommodating the extra billions with fewer negative consequences than pessimists predicted.

Concerns over sustainability definitely have merits, but there can be hope that further advances across a range of technologies will continue to ease the additional pressures as more people are packed into a finite space.

Another reason to keep calm is the decline in the rate of population growth worldwide. Rates peaked in the 1960s and fell thereafter. There is a modest chance that population growth will stabilise or even become negative by the end of the 21st Century.

Much will depend on what happens in Africa. The UN expects that continent's population to quadruple between now and the end of this century.

But if Africa follows the trend in other continents and experiences a fall in its fertility rate, the dramatic rise in its projected population - to more than four billion - will be less marked.

In most of the rest of the world it is not high fertility rates that cause concern, but the opposite problem.

The "replacement rate" (the rate needed to sustain population levels) is slightly above two children per woman. A replacement rate below two means a country's population will eventually decline. That is now happening in most countries in the rich world (Ireland is a rare exception).

And it is increasingly happening in the developing world. As a result, a growing number of countries across the world are expected to see their populations peak and then start to decline as the century progresses.

What does it all mean for Ireland?

Asia is the world's most populous region, as has been the case for thousands of years.

That continent's demographic supremacy is one factor contributing to the shift eastward in the world's economic centre of gravity.

While the dark clouds over China's economy at present mean that such a transition will not be seamless, it is all but certain that over the medium term Asia will become more important as incomes per person continue catching up with those of westerners.

This transformation creates opportunities. Although bigger export markets are the most commonly discussed upside from an Irish point of view, a more significant opportunity lies in attracting Asian investment.

Chinese companies, in particular, are becoming multinational. As they move to service distant markets by setting up foreign subsidiaries, Ireland can point to its attractions as a base to penetrate the European market.

If Asian multinationals can be attracted in even a fraction of the number of American companies, there would be a major boost for the economy over the long term.

Developments in Africa, by contrast, would appear to be more of a threat than an opportunity. If the continent's population does end up quadrupling, as predicted, then one might conclude that there will be four times as much misery, migration, conflict and instability as there is now.

But the news flow from Africa largely ignores the turnaround in the continent's economic fortunes since the turn of the century.

If that continues - and there are many indications that it will - then many of the problems we hear so much about will become less intractable, and some could even be solved entirely (that many of the Millennium development goals on health and welfare were met ahead of schedule shows that more progress has been made than is often commonly understood).

Among the consequences of stronger economic growth is lower population growth - it is a near universal phenomenon that people in wealthier societies have fewer children.

It must be hoped that the African economic renaissance continues, not least because without it the almost daily drownings of migrants in the Mediterranean will not only continue but could get much worse.

The UN currently believes that 31 million international migrants will come to Europe in the next 35 years.

As happens now, many of these migrants will come with work permits and will be fully legal. But the push factors that propel illegal migrants towards more prosperous places will only grow if Africa's economy falters and its population surges.

Irish Independent

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