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Cape Town- Africa's middle class is growing at a compounded rate of 3.1% per year and now accounts for some 300 million out of the continent's one billion population, says African Development Bank chief economist Mthuli Ncube.
Speaking on Thursday at the World Economic Forum on Africa, Ncube described the rise as "phenomenal" as the middle class stood at 135 million people in 1990, then rose to about 200 million in 2000, until it reached its present level.
"It is rising faster than Africa's population growth, which is growing at about 2.6% per annum," he said.
Ncube was presenting the bank's report titled: "The Middle of the Pyramid: Dynamics of the Middle Class in Africa", in which the central message was that the rise of this group was helping to reduce poverty on the continent.
The report cautions, however, that there is a vulnerable category of people too.
"About 60% of the African middle class, approximately 180 million people, remain barely out of the poor category. They are in a vulnerable position and face the constant possibility of dropping back into the poor category in the event of any exogenous shocks," the report said.
Ncube said the rising middle class was characterised by being entrepreneurial in nature, often owned their own home and cars, were spending more on imported goods and services, and were inclined to send their children to private schools and universities often outside their home countries.
He said many of the middle-class lived outside their countries of origin and often sent money home to support relatives who may still be considered poor.
"Zimbabwe was a classic case of this as some $1bn in remittances helped feed people in that country as it went through its economic crisis," Ncube said.
Black diamonds
He described the middle class as "custodians of democracy" as they were more inclined towards demanding more accountability and transparency from their governments.
"They will demand more democracy, but in sub-Saharan Africa we probably will not see the violent revolutions that have occurred in North Africa as many countries do not have the homogenous populations as we have in the Arabic countries," Ncube said.
The report also pointed out that the African Development Bank's International Comparison Program results in 2005 showed that per capita expenditure among Africa's middle class had increased almost two-fold, compared to more marginal increases in other regional economies in the developed countries.
"Consumer spending in Africa, primarily by the middle class, reached an estimated $80bn in annual expenditures in 2008 - nearly a quarter of Africa's GDP based on 2008 purchasing power parity," the report stated.
The rapid rise of South Africa's "black diamonds" - the term applied to black African people who have become quite wealthy on the back of black economic empowerment, was the result of a particular policy, Ncube said.
"One can debate if this was a good thing. However, the continued rise of this class should be based more on entrepreneurship rather than just share transfers," he said.
Speaking on Thursday at the World Economic Forum on Africa, Ncube described the rise as "phenomenal" as the middle class stood at 135 million people in 1990, then rose to about 200 million in 2000, until it reached its present level.
"It is rising faster than Africa's population growth, which is growing at about 2.6% per annum," he said.
Ncube was presenting the bank's report titled: "The Middle of the Pyramid: Dynamics of the Middle Class in Africa", in which the central message was that the rise of this group was helping to reduce poverty on the continent.
The report cautions, however, that there is a vulnerable category of people too.
"About 60% of the African middle class, approximately 180 million people, remain barely out of the poor category. They are in a vulnerable position and face the constant possibility of dropping back into the poor category in the event of any exogenous shocks," the report said.
Ncube said the rising middle class was characterised by being entrepreneurial in nature, often owned their own home and cars, were spending more on imported goods and services, and were inclined to send their children to private schools and universities often outside their home countries.
He said many of the middle-class lived outside their countries of origin and often sent money home to support relatives who may still be considered poor.
"Zimbabwe was a classic case of this as some $1bn in remittances helped feed people in that country as it went through its economic crisis," Ncube said.
Black diamonds
He described the middle class as "custodians of democracy" as they were more inclined towards demanding more accountability and transparency from their governments.
"They will demand more democracy, but in sub-Saharan Africa we probably will not see the violent revolutions that have occurred in North Africa as many countries do not have the homogenous populations as we have in the Arabic countries," Ncube said.
The report also pointed out that the African Development Bank's International Comparison Program results in 2005 showed that per capita expenditure among Africa's middle class had increased almost two-fold, compared to more marginal increases in other regional economies in the developed countries.
"Consumer spending in Africa, primarily by the middle class, reached an estimated $80bn in annual expenditures in 2008 - nearly a quarter of Africa's GDP based on 2008 purchasing power parity," the report stated.
The rapid rise of South Africa's "black diamonds" - the term applied to black African people who have become quite wealthy on the back of black economic empowerment, was the result of a particular policy, Ncube said.
"One can debate if this was a good thing. However, the continued rise of this class should be based more on entrepreneurship rather than just share transfers," he said.
