With an economic growth of 5% in 2012, a foundation laid with favourable trends, Africa has been called upon to transform now.
The call was made by Dr. Carlos Lopes, Executive Secretary of the UN Economic Commission for Africa (ECA) at the just-ended 6th African Union-ECA Joint Meetings in Abidjan, Ivory Coast.
According to Mr Lopes, some of the fastest growing economies in the world are African and the continent has shown relative buoyancy in an era of economic crisis.
The UN Under-Secretary said while global growth declined by 2.7% in 2012, Africa bucked the trend and grew at 5% indicating that “all our sub-regions grew faster than the global average, with the highest rate being 6.3% and the lowest one 3.5%”.
Dr Lopes attributed Africa’s economic performance to improved macroeconomic management, increased exports of natural resources and a rising middle class, noting that Nigeria’s Lagos now has a larger consumer market than Mumbai and spending in continental households are exceeding those of India and Russia.
Dr Lopes told the gathering: “We have to seize the moment and transform this continent now that the headwinds are favourable.”
He backed his statement by saying, “a changing global context with the emergence of a diversity of economic powers and increasing Africa’s leverage provide an opportunity to bring this about.”
“Given these favourable mega-trends, the time is ripe to build on Africa’s current performance and use it as a foundation for structural transformation,” he added.
He pointed out that there are many ways in which structural transformation can be defined but his is the “large scale transfer of resources from one sector to another due to changes in economic fundamentals and policies”.
Dr Lopes is of the view that Africa’s structural transformation also requires a greater use of technology and increased productivity across sectors.
According to him, with the foundation set, “There is no doubt that Africa desires structural transformation and not structural adjustment.”
The AU-ECA meeting was themed “Industrialization for an emerging Africa” and Dr Lopes shared his thoughts saying that industrialization is absolutely indispensable to the objective of Africa’s transformation. “Industrialization will help to generate employment, increase incomes and enable diversification, including their exports,” he added.
He however, admitted that Africa has attempted industrialization before which led to remarkable progress. “In the late 1960s and 1970s, newly independent African countries emulated other regions of the world in undertaking import-substituting industrialization,” he said.
Given the dominance of global value chains and intense cost competition in the trade in manufactures, Lopes stated that Africa can gain entry into the industrial sector using its huge commodity and natural resources base.
The candid Lopes also conceded that achieving Africa’s industrialization “will not be easy”.
By Ekow Quandzie, back from Abidjan, Ivory Coast
Watch Mr Lopes delivering his speech at the 6th AU-ECA Meetings