At one point in a lifetime, every African might have envisioned becoming a billionaire. Being a billionaire in Africa has however, proved to be an uphill task. When an African individual assumes a billionaire status, societal stereotypes are inclined towards perceiving the fortunes as products of embezzlement, pillage, money laundering or corruption.
Thus, in Africa, being a billionaire is generally deduced as something far away from possibility. However, the global tally of billionaires of the universe accommodates only eighteen individuals of African descent. Of the 18, five were omitted, including Elon Musk who is understood to be of South African origin with an American citizenship and business venture. The eighteen African billionaires only form 0, 6% of the total global billionaires.
Given that Africa is endowed with vast natural resources, the failure of the continent to occupy a greater margin is worrisome. This is so because, the United Nations geosphere estimated the African population to be 17% of the total world population and thus, second only to Asia with a whopping 60% populace. Unlike a paltry 18 billionaires from Africa vis the 17% of global population, Asia accounts for 1149 billionaires which is almost half of the total billionaires in the world. The limited number of billionaires from Africa is not proportional to its population distribution. It is imperative for us to assess whether or not Africa has enough billionaires given also that, it is the poorest continent with a GDP per capita of $1860 according to an estimate by the IMF.
The top 5 African billionaires
Before an analysis of the adequateness of the total figure of billionaire representatives from Africa, an outline of who is who in Africa is crucial. This will help in establishing whether the very small proportion of billionaires in the global south area of Africa is good enough given the business environment in Africa. On the list of billionaires from Africa tops the Nigerian business mogul, Aliko Dangote .With an estimated $13.1 billion, the Forbes real-time net worth places him on position 191 of world billionaires.
Dangote has business operations across Africa in almost ten countries. He is seconded by Nassef Sawiris of Egypt who owns a stake in the Adidas franchise. Nicky Oppenheimer of South Africa and Abdulsamad Rabiu of Nigeria claim the third and fourth positions respectively. On position 5 is Mike Adenuga of Nigeria who replaced former Africa’s ‘princess’ and richest woman, Isabel Dos Santos. The latter is reportedly broke after the Angolan government froze her assets owing to allegations of money laundering and politically backed pilfering of State coffers during her father’s presidential tenure.
Becoming a billionaire in Africa
Most African governments have proved to be strict towards prospective business stalwarts of African origin. It is surprising that, investment policies in Africa mostly favour foreign investors from the East and the West as compared to the indigenous ones. Foreign investors often benefit from tax havens when they invest in African States. The story of Strive Masiyiwa is a classic example of how the African turf can be difficult terrains for an African to thrive and become a billionaire. In the period 1998-2002, the Zimbabwean telecoms magnate once underwent a series of litigation in his homeland when he sought to acquire a licence to establish a telecommunication firm. Masiyiwa took up a concerted effort against the government’s monopolistic tendencies in which the State wanted to protect itself from private competition. Eventually, after a prolonged strife, Masiyiwa was able to procure a licence and went on to establish a business empire within and outside Zimbabwe. Elon Musk, arguably the wealthiest man in the world right now only managed to break into entrepreneurship when he relocated to the United States which boasted of a functional economy and the evolution of tech-business. Suffice to mention that, the poor economic status that pervades the African continent is a concise reflection of why Africa has a dearth in the Forbes billionaire’s list.
Weak economies in Africa
African economies can be argued to be recovering from the retrogressive impacts of colonialism while facing the impending harsh reality of neoliberalism. The colonial history of Africa has proved to be an impediment on the billionaire prospects of most would-be African billionaires. Colonialism was characterised by massive plunder of resources from Africa for the development of most developed countries in the global North. The Royal Geographical Society notes that, the legacy of colonialism is the reason why private wealth development is very low since industry, education and soft skills gap between Africa and Europe is very huge. It is for this reason that, Africa has a very low representation at the top echelons of global private wealth.
Further, the advent of the COVID-19 pandemic might also be a curtailing factor since, for example in Nigeria, oil prices went down. This had a cumulative effect on African billionaires who venture in oil production such as the richest woman in Africa, Folorunsho Alajika who fell off the billion benchmark early last year. Weaker currencies and year on year inflation have also adversely affected the ease of doing business and taking up highly profitable entrepreneurial risks in Africa. From 2018-2020, Africa used to contribute at least 22 billionaires on the world list, but the volatile African economies often slash the numbers.
Those that seem to hold firm and maintain the billion mark often experience comparative annual falls in revenue. On the other end, the prospects of emerging young billionaires from Africa is very low given that , there is massive exclusion of youths from the economic arena since , in Africa, politics and economy are usually in sync. The political bureaucracies of the day do not seem to favour youth inclusion and thus, generally, with a median age of 19, Africa risks not doubling its billionaire representation in the coming future. There is a big propensity that the continent will recycle those same names it has boasted of over the decade.
The geographic distribution of billionaires in Africa
In Africa, most billionaires are based in or are of Nigerian, South African and Egyptian origin. Amongst the 18 billionaires that Africa has currently, Egypt and South Africa own five billionaires each, Nigeria owns four, while Morocco brags of two. Algeria, Zimbabwe and Tanzania sum up the list with one billionaire each. This distribution is biased towards African economic powerhouses and the thriving powerhouses of North Africa. It is no mistake that the biggest number of wealthy people comes from Egypt, Nigerian and South Africa as these countries have a better GDP than the rest of the continent. Statista affirms that, South Africa has the highest number of high-net-worth individuals (HNWIs) to the tune of 39000. It therefore qualifies to elucidate that big economies create a healthy environment for the accumulation of private wealth. Therefore, while the 18 billionaires total is not the desired in so far as it does not truly reflect Africa’s potential, it is a clear exposition of sound economic realities of the African business arena.