- Africa has experienced economic growth in the post-WWII period, but has lagged behind other regions like Asia. Nigeria is used as a case study. - Regression analysis of World Bank data on Nigeria finds that factors like infrastructure, human capital, policy uncertainty, and corruption negatively impact foreign direct investment. - For Africa to have sustained economic growth, it needs continued improvements in areas like democratic governance, economic policies, infrastructure, education, and reducing security issues like terrorism. Attracting foreign investment through competitive business environments will also be important.

1. Economic Growth in Africa: Has Its Time
Arrived?
Presented by: Dr. Olumide (Olu) Ijose
Associate Professor, Governors State University
and Consultant, Jacob Business Solutions

2. Brief Survey: Post World War II Globalization History
• USA and Western Europe
• Japan
• Asian Tigers
• China

3. Implications – Post 1975 period
• Competitive pricing pressure
• Innovation and quality improvement
• Globalization of production
• Globalization of markets

4. A lens on Africa
• Global competiveness- World Economic Forum Data

5. Nigeria as a case study
• Institutional Quality – World Bank Enterprise Survey Data
• Political and legal risks
• Economic structure

6. Regression Results - Nigeria
Number of obs = 3146
F( 18, 3128) = 6523.99
Prob > F = 0.0000
R-squared = 0.9741
Adj R-squared = 0.9739
logFDI Coef. Std. Err. t P>|t|
Telecoms .097 .066 1.47 0.142
Elect -2.168 .054 -39.29 0.000
Transp -.447 .058 -7.67 0.000
Land -.211 .054 -3.91 0.000
Taxrate -.572 .070 -8.13 0.000
Taxadmin -.183 .068 -2.70 0.007
Custtrdreg -.780 .072 -10.71 0.000
Laborreg -.023 .074 - 0.32 0.750
Humancap -.104 .063 -1.66 0.097
Bizlicen -.194 .069 -2.82 0.005
Policyuncert -.431 .063 -6.80 0.000
Finaccess -.479 .060 -7.87 0.000
Fincost -.352 .065 -5.42 0.000
Polenv .324 .065 4.96 0.000
Macroenv -.318 .055 -5.78 0.000
Corrupt -.076 .057 -1.33 0.184
Crime -.418 .063 -6.55 0.000
Informal -.457 .064 -7.09 0.000
Data Source: World Bank Enterprise Survey

7. Balance of the Data – How Close is Africa to
Economic Takeoff?
• Political - Representative democracy, government’s choice of policies (anticorruption,
education, regulation, antitrust, liberalization, industry clusters, tax, capital markets,
product standards etc.)
• Economics – Exchange rate, interest rate, unemployment, economic structure, openness
and free trade, economic growth, foreign reserves, balance of payments
• Infrastructure - The smart phone revolution, capital formation
• Human capital - Education, skills and technology
• Conflict and Insurrection – Religion: AQIM, Al Shabaab, Boko Haram; Ethnic/tribal
• Informal institutions – culture, language, political history – near term and distant
• Pattern of trade – imports, exports and Foreign Direct Investment
• Risks

8. Going forward
• Post Great Recession/Quantitative Easing - Missed Opportunities; bonds,
interest rates, foreign direct investment
• Attracting Foreign Direct Investment – Lessons from the Asian Tigers and
BRIC; institutions, resources, capabilities, global value chains/comparative
advantage/factor costs
i. Institutional quality
ii. Education, English as a language
iii. Cultural discipline
iv. Leveraging global value chains and natural resource endowments/factor costs
v. Political diplomacy and tradeoffs
• Strategic partnerships - Globalization of production
• Entry mode – Rise of the middle class?, Globalization of markets

9. Web table 28. The world's top 100 non-financial TNCs, ranked by
foreign assets, 2013 a
Ranking by: Assets Sales Employment
Foreign
assets
TNI b
Corporation Home economy Industry c
Foreign Total Foreign Total Foreign d
Total
TNI b
(Per cent)
1 81
General Electric Co United States Electrical & electronic equipment
331 160 656 560 74 382 142 937 135 000 307 000 48.8
2 34
Royal Dutch Shell plc United Kingdom Petroleum expl./ref./distr.
301 898 357 512 275 651 451 235 67 000 92 000 72.8
3 67
Toyota Motor Corporation Japan Motor vehicles
274 380 403 088 171 231 256 381 137 000 333 498 e
58.6
4 56
Exxon Mobil Corporation United States Petroleum expl./ref./distr.
231 033 346 808 237 438 390 247 45 216 75 000 62.6
5 21
Total SA France Petroleum expl./ref./distr.
226 717 238 870 175 703 227 901 65 602 98 799 79.5
6 38
BP plc United Kingdom Petroleum expl./ref./distr.
202 899 305 690 250 372 379 136 64 300 83 900 69.7
7 9
Vodafone Group Plc United Kingdom Telecommunications
182 837 202 763 59 059 69 276 83 422 91 272 e
88.9
8 68
Volkswagen Group Germany Motor vehicles
176 656 446 555 211 488 261 560 317 800 572 800 58.6
9 66
Chevron Corporation United States Petroleum expl./ref./distr.
175 736 253 753 122 982 211 664 32 600 64 600 59.3
10 36
Eni SpA Italy Petroleum expl./ref./distr.
141 021 190 125 109 886 152 313 56 509 83 887 71.2

10. Thank you for Attending!