Africans will need to look into how UK’s exit can make their economy
more robust by promoting some of their homegrown trade initiatives.
PHOTO | CYRIL NDEGEYA | NATION
Financial disruption associated with Brexit looms over Africa
and may result in negative pressure on regional integration and
EU-Africa trade, warn African business leaders.
Speakers
on the sidelines of the Annual General Meeting of the Cairo-based
Afreximbank in Kigali, argued that African economies need to develop
strategies for coping with the uncertainties and harness the
opportunities that may come with the United Kingdom’s exit from the
European Union.
Business leaders emphasised the need to
improve negotiating skills, social and physical infrastructure,
knowledge and technological capacity if the continent is to continue
attracting more investors.
“For Africa to make good use
of this trade and aid relationships, countries have to make plans,
mobilise internal resources and develop stronger agendas.
But
skills are much more important for investors won’t come here if they
see weak manpower,” argued Osita Ogbu, a professor of economics and a
director at the University of Nigeria.
Prof Ogbu pointed to the need to improve the negotiating skills
of African leaders and delegates who spend most of their time in the
corridors of the World Trade Organisation (WTO) but fail to win any
tangible benefits for their countries.
“I have seen
people when going to negotiate, they use people from ministries of trade
and industry while leaving behind the best negotiators - mostly the
traders themselves, lawyers and academics.
“Negotiations
without due diligence or a background check won’t lead you anywhere. We
need to consolidate and negotiate as Africans, because it is easy to
negotiate as one in external relationships,” he said.
Bankers said there was a need to prepare for the possible opportunities from Brexit.
Bank
of Kigali chief executive Diane Karusisi said Africa should not be
worried about Brexit that is yet to pass but should focus more on the
opportunities within Africa because a strong internal market can be an
adequate counterforce to the risks of Afro-EU trade.
“Disruption
is no longer an exception, it has become a norm and we have to get used
to it. We also have to seize the opportunity that will come with it.
“The
ongoing African Union Reforms, spearheaded by President Paul Kagame
will be a good test for the post-Brexit period since we shall to
identify ourselves as Africans against such external shocks,” she said.
According
to her, Africans will need to be more proactive than Europeans who have
already started looking into how UK’s exit can make their economy more
robust by promoting some of their home grown trade initiatives.
Officials
from the UK equally believe that Brexit will not have a heavy impact on
Africa trade since the country will have a larger degree of
independence to engage Africa on its own.
A senior
officer at the Department for International Development (DFID) James
Wharton said the UK trade windows may widen further for African
countries.
“There are opportunities for Brexit, same as
challenges. It’s up to the African traders to identify the things that
matter to them as Africans before the exit comes into effect,” he said.
Statistics
from the European Union Trade Commission indicate that Africa’s share
of EU trade in 2016 was 7.6 per cent equivalent to 261 billion euros.
On
the other hand, Africa remains the major supplier of mineral-fuel
imports to the EU with total energy product imports (mainly crude oil)
amounting to 91.5 billion euros in 2014.
This made up
around 59 per cent of total EU imports from Africa that year with a
trade deficit of less than one per cent in 2014, down from five per cent
in 2013 and 11 per cent in 2012.
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