Why Africa Does not have Many Billionaires

Poverty

Africa is poor, no doubt. Despite the fast growing economies like Nigeria and Kenya, most of Africa remains poor. Using GDP as a measure of a country’s wealth, Nigeria, despite her being touted as Africa’s largest economy, had GDP of only about $432 billion in 2020. If Elon Musk were a Nigerian, that would mean that he controls more than 50% of the country’s economy.

Illiteracy

How do you teach someone who cannot read how to order a shoe online? What if he can read but does not know how to use the Internet? Jumia, Africa’s Amazon, has not yet gotten over this problem. When a new product launches in most African countries, the goal is not always to start selling. It is to start changing the people’s mindset first, which slows down growth.

Government Intervention

Most African countries maintain a strong elitist community. The existing elites do not want the younger ones to come in, and the cycle propagates within families. Existing billionaires fund politicians, and politicians therefore make rules to favour existing billionaires, and the rules disfavour upcoming businesses and entrepreneurs — so the rich get richer and fund more politicians, which makes them richer, and the cycle continues.

A New Generation of African Billionaires

Truth is, the cycle cannot remain forever. Technology is the biggest leveler of wealth, and as more and more people get into technology, I predict that the new billionaires in Africa will come from techies and not oil magnates.

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Chisom Ogugua

Chisom Ogugua

I love coding, technology, entrepreneurship and medicine. I love to document my thoughts on these subjects.