As 2019 draws to an
end, there have been several critics on African governments’ hesitance
to
develop trade, especially when it comes to integration.
At no point in recent
history have calls for Africa to grow its economies been stronger.
Across the continent, economic growth is arguably the most talked-about
subject among policymakers.
So why has action on the ground failed to move the needle on this important development marker?
Economic growth has been a
campaign promise across the African continent, with its acknowledged
ability to bring prosperity, new jobs and better incomes for all.
Yet the continent is still struggling to develop its economy, experts confirm.
Experts warn that Africa’s
manufacturing industry is likely to remain small throughout the
remainder of these coming years if no immediate interventions are made.
Experts say that high
commodity prices triggered by foreign markets seemingly insatiable
appetite for natural resources have fueled rapid economic growth in
Africa since the 1990s.
Adding that many thought the
boom would revive Africa’s waning manufacturing industry. Yet to the
dismay of analysts, it failed to live up to expectations.
Had African leaders heeded
advice from experts and pumped profits from the commodity boom into
stimulating manufacturing companies, the results could have been
different. So what are the options for Africa over these coming years?
At the recent KUSI IDEAS
meeting, big names like Raila Odinga the African Union infrastructure
representative in Africa and Dr. Agnes Kalibata the President of the
Alliance for Green Revolution in Africa weighed in on value addition as a
significant thing for the African economy.
Experts unanimously conclude
that the only viable option is to add value to products and provide
transport and production of African goods.
Experts agree that one of
the main reasons for Africa’s slow economic growth is that its producers
have failed to add value to products before exporting.
The experts said that
whenever we export processed goods, we create jobs for the youth and add
value to local economies as opposed to spending it abroad. That is what
they termed moving slowly but deliberately.
For instance, they said its better for Africa to learn how to export copper cables instead of copper and aluminum sheets
“Let’s start thinking in
terms of value addition in Africa. We make coffee, it’s great, we export
coffee, it’s great, but we need to figure out how we add value to what
we produce. We cannot take unprocessed products to the market and expect
high profit,” said Eric Chinje, a former World Bank Senior Manager
during an interview with Business Times.
According to Kalibata,
Africa imports every year $35 billion worth of food which is projected
to rise to $110B in coming years if nothing is done to add value to our
exports and decrease exports.
Transportation
Transportation and logistics
development for Africa’s industries could be responsible for lifting
the region’s economies out of poverty, according to Raila Odinga, the
High Representative for Infrastructure Development at African Union
Commission.
“Opening the interior of
free continental trade is by setting policy that creates transportation
facilities for market-based products movement that creates jobs,” he
said
This, a former senior World
Bank manager is quick to clarify to the Business Times, is “an argument
for a heavy-handed approach that would bridge productivity and smooth
movement’’.
Alluding to one of the
lessons from his experience, Raila added: “Markets must work for
governments and should look for a way to connect so as to have a role to
play in that inclusive trade.”
China sells its products affordably globally because they are not charged any transport fees.
Furthermore, 95 per cent of
products transportation is by water with some countries taking advantage
to charge transportation fees which consequently makes African traders
raise product costs.
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