Estimates of the possible economic effect of the demographic dividend for sub-Saharan Africa for the period up to 2036

Abstract

An acceleration of economic growth in Tropical Africa is currently expected due to the demographic bonus. These expectations are based on the assumptions of an accelerating decline in fertility in the countries of Tropical Africa. At the same time, it should be noted that a significant number of countries in the region have faced rather long periods of no decline in fertility, or even some fertility increase. Accordingly, the scenario of an accelerated fertility decline is by no means guaranteed. Moreover, in order to receive a demographic bonus, a specific employment policy (aimed at full-time employment) is required, as well as policies related to wages and social issues. However, the implementation of these measures should not be taken for granted; it is possible that they will not be implemented. This raises the question of the difference between development scenarios taking place with or without such measures. We model these two scenarios and compare them, revealing a significant impact of the demographic bonus on GDP per capita, which should be expected in various African countries under the scenario of an accelerated decline in fertility. For Nigeria and Niger, the differences in growth rates are most pronounced, and the demographic bonus is the largest. An accelerated decline in fertility could boost economic growth in Nigeria by 2.5 times, or 2.7 percentage points. However, this scenario is definitely not guaranteed. Our analysis provides several reasons to seriously doubt the prospects for an “automatic” fertility transition in Tropical Africa in the next few decades.