From basket case to regional powerhouse, Africa--the last bastion of growth--has exceeded economic expectations over the last 20 years. Global leaders, analysts and economists alike, buoyed by increasing GDP, a burgeoning middle class and promising trends towards democratisation have adopted the "Africa Rising" rhetoric to illustrate the continent's transformation.
Africa became an investor's dream: low wages and the promise of huge returns saw funds and financiers clawing their way onto the continent. Private equity investments in Africa blew up, and country after country began issuing Eurobonds at ever increasing volumes. Investors' appetites could not be satiated.
But just as the Africa Rising sentiment started to take hold, cracks began to appear. According to the World Bank, regional growth fell to just 3% in 2015 and is predicted to decelerate in 2016 with low commodity prices, tight financing conditions, droughts and a global economic slowdown to blame.
While some countries have benefitted from strong growth in recent years, wealth hasn't trickled down to the wider population. According to a report published by the World Bank in March, while the proportion of people living in poverty in Africa has decreased since 1990, the absolute number has increased. The Bank's most optimistic estimate is that the number rose from 280m in 1990 to 330m in 2012. According to the report, this is due, in part, to the huge population growth the continent has seen over the last few decades.
The current context
"These days It is too simplistic to continue to use the Africa rising' narrative," says Yvonne Ike, head of sub-Saharan Africa at Bank of America Merrill Lynch based in London.
"What I would say is that, given current economic conditions, the divergent performance and outlook of African economies is becoming more evident. In fact, some of Africa's countries are doing very well in the current context. Ethiopia, Rwanda and Cote d'Ivoire stand out as successful, but in Nigeria and South Africa, growth is stalling for different reasons. There needs to be a recalibration of what we mean by Africa Rising'," she says.
Nigeria and South Africa--the continent's largest economies--have recently come under the spotlight as their economies have slumped. A global commodity price meltdown has taken its toll on Nigeria's oil sector, while diminishing demand from China, and controversial policy around the mining sector has driven South Africa's growth to a halt.