South Africa’s economic development will ride in the cockpit of the Fourth Industrial Revolution.
My assertion is based on the forecasts done by Klaus Schwab in his latest book, The Fourth Industrial Revolution.
According to this book, Africa will benefit immensely from the ageing declining populations in Europe, North and South America, the Caribbean, Asia (including China), southern India, and some Middle East countries.
This view is supported by the report published in 2011 by the African Development Bank (ADB) entitled “Africa in 50 Years’ Time”.
According to this report – Africa is the only region where there will be about 1.87 billion people of working age in about 50 years’ time.
On the other hand, Africa will have more than 3billion people by 2050. This means that around 74percent of the African population will be of working age.
Other than an increment of nationalism sentiments across Europe and the US, the Europeans are tightening their migration regulations. Instead of importing skilled labour, they move their firms to the countries that have such labour.
In the past century, East Asia and South America were the best beneficiary of this kind of direct investment.
However, due to Asia’s ageing populations, investors will move their manufacturing plants to Africa, where there will be abundant labour and consumers of produced products.
According to the ADB, there is a huge decline in Africa’s child mortality rate and deaths caused by HIV/Aids related diseases. This is a significant factor in Africa’s population growth.
Another crucial factor in favour of Africa’s massive economic growth is the fact that the continent possesses half the world’s arable land. This will lead to massive agricultural investments and Africa’s food production will feed the whole world.
This view is supported by the World Bank – which predicted that Africa’s agriculture and agribusiness markets are destined to top $1trillion (R14.39trillion) in 2030.
According to Professor Calestous Juma of Harvard Kennedy School of Government, three technologies will be deployed to boast agricultural output in Africa; these include Geographical Information Systems, nanotechnology, biotechnology and mobile-technology.
Four technological (industrial revolution) megatrends, which will play a prominent role in driving economic development in the near future, are autonomous vehicles, 3D printing, advanced robotics, and new materials. Africa will be the biggest beneficiary of these technologies.
Due to the shortage of infrastructure in the form of roads, rail, border posts, airports, seaports etc, it is cheaper for Nigeria to import food from Peru instead of Cameroon.
Because multinationals will mainly be operating in Africa, they will work with the African governments to build infrastructure that services their operations and transports their goods. In other words, infrastructure will be built through public-private partnerships.
It will be in the best interests of the investors to participate in the construction of the infrastructure.
In some instances, the public (consumers) will also have to pay for this, in the form of taxes and payments, such as tolls.
Currently, due to the lack of infrastructure, trade among African countries is limited. By 2050, intra-African trade will increase substantially thanks to the availability of regional connectivity.
The availability of multinationals and infrastructure in Africa will inevitably lead to free labour movement. Something good about labour movement is that it will increase the flow of remittances across the African countries.
The incremental growth of populations, industrial production, agricultural activities and mining will require huge quantities of water.
In certain parts of Africa, there is a lot of water in the ground and technology will be employed to extract such water.
The Fourth Industrial Revolution’s mega-technology will also be used to harvest rainwater.
Africa is surrounded by two oceans, the Atlantic and the Indian.
Mega-technology will also be employed to extract water from these oceans and make it consumable. Moreover, technology will play a critical role in the recycling of water.
In fact, most production activities in manufacturing plants will be done with less water. Technology will play a critical role in promoting intra-continental trading and the supply of water.
Although the South African population remains stagnant and will not grow rapidly, South Africa can become the biggest beneficiary of this African growth.
That is why South Africa should cultivate better relationships with other African countries. Among other things, we should stop being xenophobic and treating fellow Africans with arrogance and a condescending attitude.
In the absence of huge population like other African countries, South Africa’s strength will be to continue to serve as African gateway to the African continent and regional financial hub.
• The views expressed in this article are that of the author/s and do not necessarily reflect that of the University of Johannesburg.