An African business magazine has just revealed that there are 55 billionaires in Africa. Ventures magazine realised the findings with great acclamation, prompting incredulity from its title “Many more African billionaires than previously thought”.
While you might be surprised to hear that there are billionaires in a continent of famine and floods, coups and corruption, don’t be. Though the famine, floods, coups and corruption are all real, the over-reporting of them with respect to other African issues leaves us with the “African stereotype”. In actual fact, with exploits of Chinese investment, truckloads of aid and buckets of oil, diamonds and gold, the real question should be: Why are there not more billionaires in Africa?
To put this into perspective, Russia, a country of similar size to the continent, which also suffers corruption, though perhaps not coups, has 92 billionaires according to WealthInsight.
“The problem with Africa…” begins many a conversation of the continent, but in terms of wealth, the problem is exodus. Many of Africa’s wealthy, it seems, would rather live in Europe. Of the Ventures top 10 lists, at least two live in Europe, perhaps more. The real story, then, is not how many billionaires there are in Africa, but how many African billionaires there are out of Africa.
To answer this question, start looking in Paris, where French prosecutors are investigating assets held by rulers and their entourages of at least half a dozen tin-pot republics. 11 supercars (including a conspicuous white convertible Rolls Royce coupé) were seized from the son of President Teodoro Obiang of Equatorial Guinea, who faces corruption charges in the US. 39 properties in Paris and the south of France are now known to belong to family and associates of the late president Omar Bongo of Gabon. And finally, 112 French bank accounts have been traced back to President Denis Sassou Nguesso of Congo (Brazzaville).
While supercars and villas symbolise wealthy African’s penchant to show off, they are a minority. What is more worrying are the amount of transactions between African states and offshore centres. Africa is booming and investors know it – foreign direct investment (FDI) has more than doubled in the past 10 years – but with offshore centres negotiating investor protection the tax reward is minimised. Offshore financing may be fast becoming a taboo in Europe, but in Africa it’s by-the-by. Dubai, Singapore, The Seychelles and Mauritius are the offshore equivalents to Africa as Guernsey and Jersey are to us.
Any criticism of wealth not “trickling down” to the poor, as highlighted in a recent Afrobarometer survey, should therefore target those taking money out of the continent, rather than those within.
That there are 55 billionaires in Africa is no surprise, the quantity of billionaires is a good barometer of wider wealth. But if there are “Many more African billionaires than previously thought”, it’s not in Africa, it’s out of Africa.