By Carlos Lopes and Tony O. Elumelu
The economic performance of Africa in the last
few years has been remarkable. The continent has consistently defied the
global trend.
Five years after the global financial system came perilously close to collapse, the global economic outlook is still uncertain.
In Europe, GDP is still below pre-crisis levels
and unemployment is at a record high. Recovery in the United States,
although stronger, remains weak by historic standards, and even China,
which has done so much to drive global growth, is slowing down.
Yet, in what some might call an unexpected twist,
average growth in Africa over the last decade has been more than five
per cent. Of the ten fastest-growing global economies, seven are in
sub-Saharan Africa. But how will this economic spike be sustained? How
do we ensure we continue along this trajectory?
It is the world’s appetite for Africa’s rich
natural resources which, up to now, has been the major driver of this
stellar record. And it is this same appetite that will provide both the
opportunity and the solution for Africa to sustain these economic
achievements
.
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While not all African countries are commodity
rich, the continent has 12 per cent of the world’s oil reserves, 40 per
cent of its gold, and 80-90 per cent of its chromium and platinum.
Africa is also home to 60 per cent of the world’s
underutilised arable land and has vast timber resources. The idea that
these abundant natural resources can be the driver for an industrial
revolution across the continent is growing.
The latest edition of the Economic Report on Africa
(ERA 2013) sets out how the continent’s future will be determined by
how policies that promote commodity-based industrialization are designed
and implemented.
It is clear that governments, both individually
and collectively, have an important role. A supportive policy and
investment framework is essential to attract long-term investors.
Policies to build local capacity and address
inequality are essential. Moreover, developing skills through training
and incentives will ensure that local economies are able to grow and
diversify.
However, a barrier to Africa’s industrialization
that is not often talked about is the mind-set of private sector leaders
– both in and outside Africa. Many are still indulging in the same
historical rent-seeking attitudes that have resulted in the short-terms
gains of crude, cocoa and gold sales.
More business leaders need to change their
thinking and understand that short-term revenue gains – as opposed to
long-term value addition – offer little or no contribution to
sustainable economic growth.
We are now seeing a new style of African business
leader emerging – leaders who are building, investing, growing for
Africa’s future. It is their efforts which will provide the jobs and
income which will have the biggest impact on tackling poverty and
driving wider social progress.
Africa’s private sector must take the lead in
improving coordination between farmers, growers, processors, and
exporters; in increasing competitiveness in the value chain; and
ensuring the price, quality, and standards that market demands are met.
We need to see national and regional champions
created and supported, and help foster effective collaboration between
public and private sector and the development world.
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