23 January 2014
Africa needs to create an enabling environment for domestic and foreign investment to realize its potential and ensure inclusive growth for its population, panelists agreed at a special session on the opening day of the World Economic Forum’s annual meeting in Davos, Switzerland on Wednesday.
However, the continent had many challenges to overcome, including addressing a pervasive and growing inequality that was fueling instability. And with the continent’s population expected to rise to 2-billion by 2050, it was imperative that the foundation for sustainable and inclusive growth be laid now.
“We need jobs, jobs, jobs,” said Ghanaian President John Dramani Mahama, one of the panelists at the session dubbed “Africa’s Next Billion”. “Economic and social inclusion is a top priority. We create space for the private sector, and it’s one of government’s responsibilities to distribute the fruits of growth.”
More intra-Africa trade could boost economic growth, Mahama added. “I feel ashamed that trade between our countries is only 11%. That is unacceptable.”
To build on the progress Africa had made so far, he said, governments also had to continue to realize the democratic dividend of good governance, respect for human rights and rule of law.
Nigerian President Goodluck Jonathan pointed out that there was stability in most African countries today. “But before we could talk about economic growth, we needed political stability,” he said.
Aliko Dangote, chief executive of Nigeria’s Dangote Group and a co-chair of this year’s annual meeting, pointed out that the majority of foreign investors were too cautious in the lead-up to elections and during what could be the short-lived reign of political parties. “Today there is no government that will be against business, so go ahead and invest,” he urged.
“People always underestimate what Africa can be,” Dangote said. “By 2050 we will have a united Africa with one common market … Can you imagine if we had sufficient power? Our GDP would be US$9-trillion by 2050. It can happen.”
Julian Roberts, group chief executive of Old Mutual, United Kingdom, told participants: “Africa is on the move and it is moving forward. But we need to ensure we have an enabling platform for business.” Roberts said the continent would not succeed unless there was a “handshake between government and the private sector”.
If the continent’s infrastructure bottlenecks can be overcome, particularly intra-African transportation routes, intra-Africa trade could flourish and create prosperity,” Roberts added. “Our target should be 80% intra-Africa trade by 2050.”
Africa’s economic growth might be accelerating, but, according to Winnie Byanyima, executive director of Oxfam International, United Kingdom: “The concentration of wealth and power is excluding and locking out millions of people, which is driving insecurity and instability.” So far, economic growth had been a race to the bottom, Byanyima said. “We need a race to the top so we have policies and regulation to protect human rights, the environment and reduce poverty.”
Doreen Noni, creative director of Eskado Bird, Tanzania, noted that young people in Africa were not trained from a young age to have entrepreneurial skills. Because of its huge young population, Africa’s workforce was set to burgeon by 2050. “We need to awaken our youth … and direct them to be entrepreneurial. We can only get our continent to have inclusive growth if we are educated and change our mindsets.”
Source: World Economic Forum