One of Africa’s main economic disadvantages has been its distance from the world’s centers of economic activity. This has reduced Africa to the kinds of industries that don’t depend strongly on transportation or communication, e.g., land-based industries such as farming, mining, and high-end tourism based on air taxis.
Internet and the modern jetliner would seem to offer the potential for Africa to weave itself into the global economy. What are African governments doing in this area? Their very best to prevent Internet and air travel from reaching the average citizen.
It is too difficult and expensive to build highways and railroads in most African countries, which makes air travel much more critical than it is to people in rich nations. Taking all costs into account, including capital and infrastructure, airliner travel should be by far the cheapest per passenger mile. African governments, however, have imposed so many restrictions aimed at protecting their local carriers, that air travel costs about 2-4X as much as it does in the rest of the world. The result is a somewhat hobbled tourism industry, since only rich people can afford to get around Africa, there aren’t many flights, and those flights tend to book up long in advance. The deeper result is slower economic growth, since the flights are completely unaffordable for middle class Africans.
African Internet has already been discussed in these pages. Basically, it doesn’t exist and, where it does, the costs are 10-100X higher than in the rest of the world. A handful of insiders make some good money from the telecom monopoly, but the effect on business is devastating.
Until these issues are resolved, it is hard to see how foreign aid to Africa will lead to sustainable growth. Currently, it would be much cheaper to bring skilled Africans to Kansas than trying to do business in Africa. Housing costs in Kansas are about the same as in Africa. Security is free in Kansas. Telecommunications are basically free. Getting around by airline to see customers will cost 25-50% of what it would cost from Africa. If capital investment is required, the cost of capital will be much lower in Kansas since investors won’t fear a Zimbabwean-style expropriation or disintegration.
Judging by my spam folder, Nigeria has plenty of Internet connectivity.
Haha. Mind you, many of those Ips originate from South Korea. Pertaining to the article, another factor would include control over local natural resources…..