Zimbabwe may be a basket case, but other sub-Saharan countries are faring better

The events of the last week in Zimbabwe are a tragedy. Anyone who has spent time in that beautiful country and enjoyed the hospitality of its warm and generous people will feel rage that Robert Mugabe could have brought it to ruin. When I first visited nearly 20 years ago, Zimbabwe was the great success of Southern Africa peaceful and relatively prosperous, a beacon of hope to its troubled neighbours such as Zambia, Mozambique, Angola and Tanzania, just emerging from dictatorship and civil wars. Zambia, where my family lived for a while, was a basket case in comparison.

If there is a glimmer of hope from the last week, it is the reaction of Zimbabwe's neighbours to its plight. With the shameful exception of South Africa's Thabo Mbeki, many African leaders have been vocal critics of Mugabe's brutal terror tactics chief among them the presidents of Zambia and Angola. Their response is testimony to the remarkable transformation across much of the region over the last decade.

Of course, this progress is partly due to high commodities prices. Many African countries are rich in natural resources. Commodities account for 50% of the region's GDP. For example, Nigeria, Cameroon, Gabon and Chad are oil exporters. Zambia is rich in copper. Ghana, Kenya, Ethiopia and Uganda are big exporters of soft commodities such as cocoa, coffee and tea. As a result, sub-Saharan African growth has topped 5% every year since 2003, compared with an average 3.4% between 1997 and 2001. Last year it hit 7%.

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Yet it is wrong to attribute all this success simply to high commodity prices. Most countries in the region are net importers of commodities. And many of those with the biggest commodity exports have been among those with the slowest growth, including Cameroon and Gabon. Nor can the improvement be explained by debt relief and other aid, which, although these have risen over the last decade, still remain marginal at only 1.6% of sub-Saharan African GDP in 2006, according to the IMF.

Better governance and better economic policy-making undoubtedly lie behind much of this African success story. Inflation across the region, excluding Zimbabwe, fell below 10% for the first time in 2000 and reached 6% in 2006, remaining low by historical standards since. In previous commodity booms, governments squandered the proceeds on spending programmes that proved unsustainable when the boom ended. This time, the countries have been using the proceeds to pay down debt and boost reserves. That has strengthened currencies, paving the way for limited, but symbolically important, domestic financing programmes, which should improve macro-economic stability. Nigeria and Tanzania have both successfully issued ten-year bonds.

Renaissance Capital, a Moscow-based developing market investment bank that has been pouring resources into Africa, likens sub-Saharan Africa to Russia 15 years ago. That is borne out by the IMF measure of economic institutional risk, which allocates an average score to sub-Saharan Africa of 31.3 out of 50 (the higher the score the better) similar to that of Asia in 1984. Meanwhile, education is improving, with 98% of children now enrolled in primary schools and 37% going to secondary school again a pattern similar to that of Asia in the 1970s, according to Unesco.

True, sub-Saharan Africa still faces huge challenges. Politics remains an ever-present danger. The Economist Intelligence Unit's "democracy index" gives the region 4.24 out of ten the lowest of any region. Sub-Saharan Africa also tops most indices for corruption. Spiralling food prices are already leading to social unrest in some countries, and high concentrations of under-employed slum-dwellers contribute to volatility, as Kenya discovered after this year's election.

There is also the ever-present threat of AIDS and other diseases, as well as the growing challenge of climate change. On the economic front, there is the danger that high commodity prices will lead to further currency appreciation, stifling growth in other sectors.

Brave investors have done well from Africa over the last few years. As a result, plenty of Africa-focused funds have been launched to tap into the boom. Sceptics will argue that excitement over so-called frontier markets is classic top-of-the-cycle stuff. Those convinced that high commodity prices are a bubble will certainly want to steer clear. But anyone who thinks that high commodity prices are here to stay and is willing to withstand a potentially high level of volatility might consider a gamble. It would be a vote of confidence that Africa's destiny may lie the way of Zambia rather than of Zimbabwe.