African growth does little to cure inequality
In a cafe on the terrace of a Nairobi mall, well-heeled Kenyans sip coffee as shoppers in the car park navigate between BMW X5s, Toyota Land Cruisers and Mercedes. A nearby cinema last month advertised an array of Hollywood fare including Brad Pitt's Moneyball.
Sales at the Java House outlet along the Ngong Road were up last year, says Kevin Ashley, a Californian who co-founded the chain of 14 coffee houses 13 years ago. Kenya's rich and new middle classes have a growing taste for lattes and ice cream.
That's just one sign that African states such as Kenya are changing. Even as rich countries face a slowdown, sub-Saharan African economies are expected to post nearly 6% average growth in 2012, according to the International Monetary Fund (IMF).
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But the wealth on show at the mall has a flip side. The consumption boom has been fuelled by fast-growing credit. In Kenya and elsewhere that has sucked in imports -- cars, shoes, clothes, wines and whiskies -- and swelled the current account deficit. Inflation in Kenya is now nearing 20%. As always, high inflation hurts the poorest most.
http://mg.co.za/article/2012-01-24-african-growth-does-little-to-cure-inequality
