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Five Reasons to Be Bullish on Africa

Today's summit of Young African Leaders in Washington is getting some high-level attention from the Obama Administration. Secretary of State Hillary Clinton addressed the gathering this morning, and the President himself has invited the delegates to the White House for a town hall.

The elevation of African issues in America's foreign policy agenda is in some ways unsurprising. Not only does the continent pose a mix of security, economic, humanitarian and political challenges, but it has also emerged as a primary venue for diplomatic competition between the U.S. and China. China has been pouring billions in direct investment into the creation of roads, airports and other infrastructure, growing closer to the governments that control many of the vital strategic minerals that China hopes will fuel its own growth in coming decades. America's best diplomatic asset in these times of austerity is a President named Barack Obama.

But Africa's emergence is also a business story. Africa is home to 900 million people. Its better-performing economies have been posting GDP growth of 7-9%, even in the face of the global recession (U.S. growth last quarter was 2.2%). Countries like South Africa, Egypt and Morocco are solidly within the global "middle class" and others like Ghana, Cameroon, Kenya, Uganda, Botswana and Malawi are knocking at the door. Its industries are becoming more competitive; its consumer markets more viable and mature.

Over the past 18 months, I've had the pleasure of communicating with a number of African business leaders and entrepreneurs—some of whom are represented at today's gathering. That experience has given me these five reasons to be bullish on African from a business perspective:

1. Africa's Youth. In some countries, more than 70% of the population is under 20. That kind of demographic dividend, where young workers vastly outnumber dependent elders, produced the kind of economic miracles experienced in Southeast Asia, China and India in recent decades. Success is of course dependent on the ability of the countries to turn those raw numbers into productive talent through investments in education, infrastructure and economic reform. Fortunately, that's being helped along by ...

2. Africa's Technology Revolution. The Continent which had long been a backwater of underdevelopment has leapfrogged over generations of older technology right into the mobile digital era. The deployment of the Seacom cable last year instantly vaulted East Africa from one of the least-provisioned regions for broadband into one of the most wired. Mobile devices are ubiquitous, and for the first time in 2009, voice-and-data plan enrollments topped voice-only. The spread of higher-quality devices and connectivity is giving rise to ...

3. Africa's Innovation Revolution. Africa's young population is being exposed to digital technology and digital culture at an accelerating rate, and the experience is helping them vault to the forefront of innovation as entrepreneurs. Ghanaian Bright Simons developed an effective way to combat pharmaceutical counterfeiting using cell phones; Kenyan Ory Okolloh and a pan-African community of developers created the Ushahidi platform for crisis response. These and other leading innovators are among those attending today's sessions. Their success is leading to ...

>4. Africa's Emerging Middle Class. As African economies grow and diversify, a middle class is emerging in many countries that resembles urban consumers elsewhere in the world in terms of discernment, brand consciousness, buying power and values. Working in industries that are harmed rather than helped by government patronage, this growing middle class of educated young knowledge workers disdains the corruption and tribalism of post-Independence African politics. Even in Nigeria, one of the most historically corrupt and disorderly African nations, a movement called EnoughIsEnough, fueled by indigenous young business people, thought leaders and educated middle class urbanites, is demanding transparency and accountability. This may eventually create ...

5. Effective Governance and Economic Diversity. All but the most retrograde political leaders in Africa (such as Zimbabwe's Robert Mugabe) recognize that Africa's future prospects depend significantly on the industry of indigenous entrepreneurs creating wealth at the base of the pyramid and developing high-value intellectual capital to trade in the global knowledge economy. Nigerian social entrepreneur and activist 'Gbenga Sesan told me that "Nigeria will never develop as long as our entire economy is dependent on the price of oil." Leaders like Malawi's Dr. Bingu wa Mutharika speaks of creating a Silicon Valley in East Africa. TED Fellow Ndubuisi Ekekwe is advocating development of an electrical engineering and circuit-design industry on the continent. As these efforts bear fruit, their success will spur additional investment and further discredit the old, failed legacies of the past.

Are there still problems? By the bucketful. For a continent as richly endowed with natural resources, natural beauty, and human potential as Africa, there remain daunting problems of climate, resource scarcity and underdevelopment to go alongside the human-created problems of violence, poor governance, post-Colonial legacy and divisive fanaticism. The worst spots in Africa are unlikely to get better anytime soon—although some of the countries that were on the "hopeless and tragic" list 10 or 15 years ago, such as Rwanda, have now moved into the success-story category.

Time will tell whether Africa's success will continue, and will contribute to the success of American and global business by providing the markets, skilled labor and productive, stable economies we need for trade and export. Today's events in Washington are a start.

Rob Salkowitz is the author of Young World Rising: How Youth, Technology and Entrepreneurship are Changing the World from the Bottom Up . He lives and works in Seattle, WA.