15 Jun 2022 / Article

How can Africa be more economically independent?

 

The 8th staging of the AFRICA CEO FORUM, which began on 13 June in Abidjan, focused on economic sovereignty for the continent. This comes at a time when structural transformation of African economies is at the centre of discussions on African development.

The question is all the more important since Africa depends on the rest of the world for 84% of its trade and commerce. The opening panel sought to shine a light on the matter and involved high-level figures such as the President of Ghana, Nana Akufo-Addo, the Vice President of Nigeria, Yemi Osinbajo, and the Managing Director of the International Finance Corporation (IFC), Makhtar Diop.

The session was a platform for panellists to discuss the conditions necessary for reducing Africa’s dependence on the rest of the world. They also spoke on how heads of state could convert their commitments into concrete actions and put their countries on the path to economic development.

Ghanaian President Nana Akufo-Addo indicated that African countries were aware of the need to tackle certain areas of weakness before they could become economically independent or developed.

Another of his concerns was Africa’s preference for imported goods. “We must produce what we use and what we consume”, President Akufo-Addo stated.

To face this challenge, he says that we need to create entities that can drive a country’s economic transformation and promote the growth of national champions in areas such as agriculture, agribusiness, energy and industry.

When he took office, Akufo-Addo implemented a policy centred on four key areas: education, with a focus on technical training and scientific research; support for the private sector through government management bodies; development of the private sector so it could play an integral role in creating jobs and wealth; and conditions for a prosperous economy.

“The same thing happens in Côte d’Ivoire. We know that a concerted transformation policy for our economies must be put in place. “Despite Covid-19, Ghana posted a growth rate of 6% in 2021”, he added.

The country’s efforts have been aimed at consolidating the fundamentals of its economy, particularly by developing its human capital and accounting for the needs of each sector. Another key point: efficient public policies.

Make greater use of fiscal resources

On the matter of consumption, President Akufo-Addo’s concern was shared by Kate Kanyi Tometi Fotso, CEO of Telcar Cocoa. “Africans only consume what others produce. They take our raw materials and sell them back to us as processed products”. 

She believes that it is time for Africans to go beyond rhetoric and implement concrete actions, with the participation of governments, businesses and the wider society. “We need to change our mindset and be open, not stay in a single region of Africa, create large markets and create opportunities”, she suggested.

An equally optimistic Yemi Osinbajo, Vice President of Nigeria, stated that projects are underway, even though they are still in the embryonic stage at the continental level. He believes that the priority areas are agriculture, energy, infrastructure, among others, and highlighted the importance of ensuring food security and energy independence. He was delighted to share that the actions underway in his country to meet these objectives are bearing fruit. Agriculture in Nigeria saw a rise in the production of rice, cereals and grains, and root vegetables (yam and cassava), which are in high demand in the country.

On the topic of the path to energy independence, Osinbajo reminded the panel that Nigeria has large hydrocarbon reserves amounting to 200,000 m3, which are “more than enough to meet its needs”. But he believes that precautions must be taken with economic sovereignty.

“There is no way you can use the same territorial bases; we have to cooperate with the international tax system to ensure we’re able to derive maximum benefit. So while we’re looking inwards, we’ve got to be very careful to look outwards as well”, the Nigerian Vice President stated.

Large-scale production and competitivity

For Makhtar Diop, Managing Director of the IFC, “If we cannot produce in large quantities and be competitive, we will not achieve the economic independence that we strive for. We need to create the conditions to move forward”.

To this end, the IFC has decided to invest in the best production techniques, particularly in the agricultural sector. Diop contends that greater political commitments should be made for the development of the food and agricultural sectors, similar to the financial sector where African businesses are performing well.

Karim Beguir, CEO of InstaDeep, underlined the key role the financial sector plays in the development of the continent. He recommended that more emphasis be placed on technology and individuals in a continent where, according to the World Bank, the population is young. He sees this demographic as a source of opportunities and challenges. “Since young people make up two-thirds of the population, we must give them the appropriate tools, be flexible and provide guidance, and make them the catalysts for economic development in Africa by 2050”, he added.

Emmanuel Akani

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