Opportunity for Mauritius as gateway to Africa as sub-Saharan Africa`s middle class set to boom.
The study which uses a proven methodology widely employed in South Africa reported that the combined GDPs of the 11 measured economies has grown subsequently since 2000, up from 4.6 million, and 2.4 million in 1990. (Image: Mauritius.Genosy)
Released by Standard Bank, a report entitled “Understanding Africa’s middle class” has found out that there are 15 million middle-class households in 11 of sub-Saharan Africa’s top economies this year, which is an increase of 230% over the 14 years.
Standard Bank has attempted through the report to fill the knowledge gap by using comprehensive household income data and adopting it own measure of the middle class using South Africa’s Living Standards Measure`s (LSM) as a framework in order to provide cross-quantifiable reference points for peer African economies.
The 11 focus economies are: Angola, Ethiopia, Ghana, Kenya, Mozambique, Nigeria, South Sudan, Sudan, Tanzania, Uganda and Zambia.
The study which uses a proven methodology widely employed in South Africa reported that the combined GDPs of the 11 measured economies has grown subsequently since 2000, up from 4.6 million, and by 2.4 million in 1990.
Furthermore, based on the LSM the report gives investors data on which they can base their investment decisions.
The report points out that investors using an unquantifiable assumption might find individuals they had thought were middle class were in fact highly vulnerable to lose that status in any economic shock.
Even though the report suggests that the middle class may be smaller than previously thought, two factors should still be considered by investors; Firstly, by any methodology Africa`s middle class is growing strongly and secondly, Africa`s income accumulation is far more broad-based than it had previously been thought.
“The new report is cause for optimism among investors as it suggests even greater scope for future growth, and indeed the report forecasts acceleration in the accumulation of middle-class households in Africa,” said Standard Bank senior political economist and author of the report, Simon Freemantle.
Furthermore, he said that “concerning the undoubted ongoing improvement in Africa`s economic performance has to be tempered with the reality that the level of this growth and the nominal size of the continent`s middle class had not until now been adequately measured.”
Finally, he argues that the previous figure of 300 million ‘middle class’ Africans were viewed as a best-estimate that has now been confirmed as to trend if not as to the total aggregate.
About Standard Bank Group:
Standard Bank, trading as Stanbic Group, is the largest African bank by assets and earnings. It has a 151-year history in South Africa and started building a franchise outside southern Africa in the early 1990s.
Its strategy is to build the leading African-focused financial services organization using all their competitive advantages to the full.
Source: African Press Organisation.