On Africa’s coming of age: Aid or trade?

A few months ago, I came across a fascinating report by The Economist titled “The Africa Gap”, a seven-part deep dive into why Africa’s economic growth has stalled, where the real opportunities lie, and what it would take to change course.

As someone deeply passionate about Africa’s development, reading through it left me with a mix of emotions. I was angry, especially at the kind of leadership that has held us back. But I was also strangely hopeful. Because underneath the grim statistics, I saw possibility.

I’ve never been more bullish on Africa’s long-term growth. And more importantly, I’m eager to be part of the solution. That’s what inspired this article: to contribute one more clear voice to the conversation. Not with blind optimism, but with data, hard truths, and a few scenarios that imagine a better path forward.

To begin, here’s the paragraph that jolted me into reflection:

“Africa’s population is booming. It has doubled in the past 30 years and will likely double again by 2070. Life expectancy has improved, child mortality has fallen, and more young people are attending university than ever before. But while social and demographic indicators are trending upward, the continent’s economic performance tells a harder story: Africa is, relatively speaking, becoming poorer. By 2030, over 80% of the world’s extreme poor will be African—a staggering leap from just 14% in 1990. That trajectory has transformed what once looked like a demographic dividend into something more precarious. Since 2015, per capita income has stalled, and the World Bank now describes the past ten years in Africa as a ‘decade of futility.’ Progress, it turns out, is not inevitable. And aid, once seen as a bridge to prosperity, may have become part of the problem.”

Those lines are hard to ignore. They confront us with an urgent truth: we are growing in size, but shrinking in significance. The numbers don’t lie. And unless something shifts decisively, Africa will find itself with more people and fewer prospects. So where do we go from here?

The tyranny of good intentions

Foreign aid is often framed as a lifeline. It builds clinics, funds schools, delivers relief. But behind the photos of ribbon-cuttings and smiling donors is a harder truth: aid is rarely neutral, and almost never empowering.

In 2023, I supported a PhD research project that exposed one of aid’s most troubling truths: donors dictate the flow. Not based on what recipient nations truly need, but on what donor countries want, politically, strategically, or economically. There’s no free lunch, not even in Freetown. The saying “he who pays the piper calls the tune” is not just a proverb here. It’s development policy in practice.

The truth has always been that donors do not fund Africa’s priorities, they fund their own. Countries that become addicted to aid gradually cede something far more valuable than money: sovereignty. Some nations, names withheld, for now, have found themselves beholden to foreign powers in areas that stretch beyond finance into policy, trade, even governance. The billions of dollars, pounds, and euros that flow into Africa every year do more than build clinics or fund programs. They shape priorities. They tilt power. In some cases, they quietly buy control.

Here’s the paradox. The countries that receive the most aid are often the ones least transformed by it. Nigeria, for instance, remains a top recipient of development assistance, yet still ranks among the most structurally fragile economies on the continent. Meanwhile, South Korea, once an aid recipient, has become a donor, powered by strong institutions and globally competitive industries.

So the question is not whether aid can help. It can. The question is how it helps, and whether it is propping up systems that should be replaced or investing in the ones that can scale. Because, let’s be honest: aid is a prosthetic. It might help a nation stand. But it will never teach it to walk or fly.

Growth is not a luxury

In recent years, development thinking has drifted dangerously close to defeatism. So long as vaccines are delivered and children fed, the logic goes, poverty is being “managed.” But managing poverty is not the same as ending it. As The Economist put it,

“In almost all circumstances, faster growth is the best way to cut poverty and ensure countries have the resources to deal with climate change.”

Yet Africa’s obsession with micro-projects has displaced the urgent need for macro-level transformation: reliable infrastructure, functional institutions, and an environment where businesses can grow, not just survive.

The sad part is that even this modest ambition is hampered by structural rot. The ecosystem in many countries is rigged to reward corruption and punish innovation. Those who succeed often do so despite the system, not because of it. If the Dangotes of the world have had to play hardball just to stay in business, imagine what the average entrepreneur is up against.

The entrepreneurship illusion

Africa is hailed as the most entrepreneurial continent. But most of its entrepreneurs are not thriving visionaries, not really, they are survivalists. 71% of youth want to start a business. African women are the most entrepreneurial in the world. Everywhere you turn, someone is selling something, launching something, pitching something.

But why? Because salaried jobs are scarce. Because formal employment is stuck. Because the system forces self-employment, not out of ambition, but necessity. It is not entrepreneurship as we know it in mature economies, where firms scale over time, create jobs, attract investment, and export innovation. In Africa, the majority of businesses remain informal, undercapitalised, and unsustainable. More than 80% of employment is informal. And most businesses hire no one but their owner.

Africa doesn’t need more microbusinesses. It needs more big businesses. Scalable firms that drive productivity, employ at scale, and anchor industries. Right now, Africa as a whole has only 345 firms with revenues above $1 billion, China has over 1,500. Africa has no Fortune 500 companies. That tells you everything.

Why small stays small

Firms in other markets grow or die. In Africa, they too often remain small and static. A business that survives ten years in America typically triples its workforce. In Africa, it might stay exactly where it started. African firms struggle to grow not because founders lack grit, but because the system is suffocating.

Bank loans, where available, come with interest rates of 25–39%. For comparison, Indian and Vietnamese firms borrow at around 9%. Then there is infrastructure, or the lack of it. Power outages lead to lost productivity. Bad roads, and policy bottlenecks destroy margins. Only 10% of small firms have access to formal credit. Transport in Nigeria is 5x more expensive than in the U.S.

Worst of all, the biggest firms succeed not by competing, but by being close to power. Patronage wins where innovation should. It’s a game few honest businesses can play. The system is rigged because scale is often not earned but granted by those in power. Success owes less to strategy and more to who one knows. Businesses that survive often depends on proximity to power, not proximity to product-market fit.

A strategy worthy of its people

If there is one thing Africa’s past few decades have proven, it is this: aid is no substitute for architecture. A continent cannot outsource its development strategy. No amount of well-meaning foreign funding can replace the hard, unsexy work of building systems that work.

Africa doesn’t need more donors. It needs more builders. Builders of institutions that outlive election cycles. Builders of firms that scale, compete and hire at scale. Builders of infrastructure that moves people, goods, and ideas. Builders of trust, in banks, in governments, in contracts that are honoured.

Trade, not aid, must drive the next chapter. Investment, not intervention. Strategy, not sentiment. Consider South Korea. Once poorer than much of sub-Saharan Africa, it received aid, yes, but more importantly, it built. It invested in people, in manufacturing, in governance. It moved from recipient to donor in less than a generation. Not because it was blessed with better luck, but because it made better bets. Those same bets are available to African nations today, but only if they are willing to move beyond the politics of survival and into the politics of strategy.

Of course, no amount of clarity matters without leadership. And on that front, Africa remains deeply underserved. Much of its current political class is uninspiring, entrenched, reactive, and painfully short-termist. Business leaders, for their part, often hedge too close to power and too far from risk. But there are bright spots. A new generation of thinkers, technocrats, entrepreneurs, and civic voices are rising, frustrated, yet determined. These are the people to watch and to support.

The truth is, Africa’s coming of age will not be brokered in Geneva, Brussels, Washington or Paris. It will be forged in Accra, Kigali, Nairobi, Lagos, and beyond by leaders willing to do the hard, boring, transformational work of building systems that work. There are no silver bullets. But there is a clear choice: continue renting the future or start owning it. Africa is not waiting to be saved. It is ready to rise. All it needs is a strategy worthy of its people.