In the past three decades, the biggest improvement in education has come in Burundi. In 1980, children under seven there could expect an average of only 1.7 years of schooling, according to UNDP. Today, they will receive 11, and so the next generation of Burundian workers will be unrecognizable compared to the last. Uganda, Mali, Guinea-Bissau, Ethiopia, Guinea, and Burkina Faso have all made jumps of at least five years of expected schooling in the past three decades.
Health is another area where some countries have separated themselves from the pack. In Eritrea, Ethiopia, Guinea, and Niger, life expectancy at birth has risen by at least 15 years since 1980. Much of this change came from reductions in infant mortality. It is all the more impressive given that it came against the tide of the AIDS epidemic. For these countries, higher life expectancy will mean less hardship for families, lower fertility rates, and more investment of resources in each child.
Some of these countries, like Burundi and Eritrea, may be too small to capture investors' imaginations. But in East Africa, Uganda and Ethiopia offer more than 100 million potential consumers. And in the west, homegrown multinational corporations are already starting to span the mid-sized francophone countries.
As Korea showed starting half a century ago, vast natural resources are not a prerequisite for rapid growth. With better education and health come higher productivity, rising wages, and greater buying power. To plan for this growth, companies will need to use a long time horizon. One way to do it is by laddering the marketing of their products in parallel with increases in living standards.
An excellent example of this kind of long-term planning is Honda's investment in Vietnam. Honda established a subsidiary there in 1996, and within a few years its stripped-down Dream scooters were ubiquitous in city streets. As Vietnam prospered, the scooters got fancier. Eventually, they got doors, too. In 2006, Honda opened its first auto plant in Vietnam, producing the compact Civic for local consumption. Vietnamese consumers were used to relying on Honda products, but it took a decade for them to be ready for the big-ticket items.
Some investors may still be nervous about Sub-Saharan Africa, given its history of political instability and humanitarian disasters. But things can turn around quickly. Vietnam, a nominally communist country involved in military conflicts until the early 1990s, saw a huge surge in foreign direct investment once it made peace with its neighbors and opened its doors to trade. The resulting economic growth helped to underpin that same stability and openness. More recently, Sri Lanka's economy has expanded by more than 8 percent annually since the end of its civil war.
In this century as in previous ones, much of the investment boom in Sub-Saharan Africa has come from companies seeking to extract natural resources. Resource booms come and go, though, and commodities are eventually exhausted. What endures is human capacity, the greatest economic engine of all.