Africa’s message to the world: Do you want to be part of the next economic miracle?
By President Hakainde Hichilema
Cuts to international aid are a wake-up call that the continent’s nations need to find a way to bolster their own development. And for that, Africa needs investment.
The cuts to the U.S. Agency for International Development are a devastating blow for Africa.
For years, the U.S. generously contributed a quarter of all global aid spending in African countries, generating at least 1 percent of gross national income for 16 countries on the continent.
This aid included life-changing programs like the President’s Emergency Plan for AIDS Relief, which saved over 26 million lives, mostly in sub-Saharan Africa, since it launched in 2003. Alarmingly, these cuts came even though African nations increased their cofinancing of HIV health systems to $40.7 billion in 2021 — up from just $13.1 billion in 2004.
African countries need capital to diversify their economies, establishing not just new mines and oil rigs but factories, refineries, shopping malls and data centers.
More worrying still, is that the U.S. seems to have opened a door for other developed nations, with the U.K., France, Germany, Belgium and the Netherlands all slashing their aid budgets in recent months. By 2030, the Institute for Security Studies estimates that 19 million more Africans will fall into extreme poverty if aid from rich countries is permanently cut by 20 percent.
That is, unless African nations find a way to grow their economies more sustainably.
As the president of Zambia, these figures keep me up at night. But they’re also a timely reminder to reflect on our continent’s continued dependence on foreign aid.
Take, for example, China. In 1991, China had a GDP per capita of just $1,646, while the economic output per person across sub-Saharan Africa was more than twice that. Fast forward to 2023, and China’s GDP per person was over $22,000, while Africa’s nations flatlined at just $4,300.
Aid didn’t cause this stagnation, but it did cover for it. It allowed African governments to meet some of their citizens’ basic needs, like healthcare and education, without actually growing their economies to fund them.
The problem can, in part, be attributed to a lack of diversification and value addition in African economies, many of which still rely on the same basic processes of resource extraction that were set up under colonial rule.
Looking to China again as an example, we can see the country dominates the field of critical minerals processing. It extracts 60 percent of global rare earths and 10 percent of lithium, while processing 90 percent and 55 percent of them, respectively — in addition to 65 percent of global cobalt, 35 percent of nickel and 40 percent of copper.
Meanwhile, the Democratic Republic of Congo, which extracts 73 percent of the world’s cobalt processes hardly any of this metal, which is used in everything from iPhones to electric vehicle (EV) batteries. Zambia is the seventh largest producer of copper — another key element for the green revolution — but has historically exported much of it as raw ore to China. This is precisely why Zambia and the DRC are working together to create value chains for EV batteries in the mineral-rich Copperbelt region straddling the two countries.
China’s growth and simultaneous rise in living standards over the past three decades is nothing short of an economic miracle. However, in order to replicate it, Africa doesn’t just need aid — it needs investment.
African countries need capital to diversify their economies, establishing not just new mines and oil rigs but factories, refineries, shopping malls and data centers. “Work, work, work” — that’s the mantra we must embrace to build these industries and drive sustainable growth.
At the same time, wealthy nations tired of seeing paltry results from their years of generosity should view investment in Africa as a way to refocus their efforts, as well as ensure economic returns for their own citizens. This is about long-term prosperity, not short-term handouts.
The good news is the tide is on our side. From solar panels to AI servers, Africa is home to large deposits of the elements needed to power the world’s most sought-after technologies. And just imagine how much more efficient company supply chains could be if these materials were mined, processed and assembled all in one location.
Plus, Africa isn’t just set to be the world’s factory — it’s also one of its biggest markets. By 2050, one in four people on earth will be African. Moreover, the African Continental Free Trade Area’s (AfCFTA) implementation will unlock the world’s largest free trade area and generate some $450 billion in income by 2035. And with the right investment, companies will spring up to meet the needs of Africa’s predominantly young and aspirational consumers.
As African leaders, we know we have to do more to unlock our demographic and geological treasures. We need to ensure stable regulatory environments, invest in infrastructure and create a healthy, educated workforce — all things that aid can help with too.
We also need to do a better job of showcasing the opportunities Africa has to offer, and provide platforms to connect homegrown entrepreneurs and businesses with investors and partners from around the world. Along these lines, this July, Lusaka will host the Invest Zambia International Conference, where we want to connect vision with capital and hope to deliver diversification and growth across the mining, agriculture, finance and energy sectors.
As I told my fellow citizens last month, the cuts to international aid are a slap on both cheeks — a painful but perhaps necessary wake-up call that African nations can, and will, do more to bolster their own development.
Our message to the rest of the world is simple: Do you want to be part of the next economic miracle?