Sub-Saharan Africa’s Demographic Dividend: Is There a Role for Natural Resources?

About the project 

Natural Resource-led Development in New Producing Countries 

Our project seeks to understand how natural resource extraction can drive inclusive economic growth in new producing countries. We are engaged in a multiyear multidisciplinary study with four objectives: 

• Understand the human geography of new producing countries.
• Assess the magnitude of new discoveries and estimate direct fiscal impact. 
• Understand how industry can be localized to create economic growth.
• Estimate spillovers and welfare impacts to society.

We recognize that policymaking in new producing countries is a complex process, and our project also seeks to understand the interactions of actors’ interests that drive energy sector policies. 

Our initial focus is on four countries – Kenya, Mozambique, Tanzania and Uganda – that expect to develop significant oil and gas reserves in the next 5-7 years. Through natural resource development, these countries hope to achieve middle-income economic status by 2030-2040. This project is conducted through close collaboration with leading think tanks and NGOs in Africa.

Key Points

Sub-Saharan Africa (SSA) has the most resource-rich countries in the world, many of whom are endowed with large oil, gas and mineral deposits. This discussion paper examines the role of natural resources in the economic development and demography of countries in SSA, showcasing various paths states have taken that led them to either bless or curse the discovery and development of these resources. 

• By 2050, the number of oil and gas exporting countries in this region is expected to almost double to 22 from 12. An additional 16 will become mineral exporting countries, which will mean that more than 80 percent of SSA states will be dependent on natural resources. How the revenues earned are managed and used will determine their economic and social future. 
• The region’s population in 2015 was estimated to be 949 million and is expected to grow to 2.6 billion by 2050, which will constitute more than 25 percent of global population. The change in age structures will mean that by 2030, sub-Saharan Africa will represent nearly two-thirds of the growth in the world’s workforce. There is an opportunity to reap the benefits of a demographic dividend in this transition but careful economic planning and policies are needed. 
• Natural resource-driven development in Africa to date has not led to economic growth that significantly improved the welfare of people in these countries. The sector will not create enough jobs to cater for the number of people ente