Scribblings from the hard shoulder of the Information Superhighway

Storms in Africa

Remember you read it here first… December 2008.

I dont profess to any great prescience, and dont necessarily aspire to be Robert Peston, but a couple of things have been troubling me lately, and I think theres some synergy.

In the first place, the West has been seeking low cost providers for the past several years. Well for the past couple of hundred years if you include the British Empire, but in recent years its become apparent, as the chain stores are filled with goods made in Turkey, then India, then China, Vietnam, Cambodia. Then as the workers in each manufacturing country aspire to western liefstyles and consequently higher incomes, they become less attractive as low cost providers. Were running out of untapped low cost workers to exploit and unless a suitable source is identified inflation will rocket in the west as supplies of super-cheap clothes dry up. And that inflation could hit just as the West comes out of its current depression.

Meanwhile, you cannot help but feel for the people of Zimbabwe and their plight. The economy is in tatters and inflation is running at over 230 million percent according to the Daily Telegraph. The more the country lumbers towards total financial meltdown you sit and wonder how the economy could be rebuilt, certainly the developed countries of the West have their own problems right now and, I suspect, have little appetite for taking on a project that will cost tens of billions to rescue.

And there we have the synergy, the West needs a new low-cost provider and Zimbabwe will need to be rebuilt. Okay so factories and call centres might not fit an African ideal, but its a solution that might solve two pressing problems.

And in the longer term… South America?

December 2008 – you heard it here first.

One Response to Storms in Africa