Former Nigerian President Olusegun Obasanjo today in Mahe, Seychelles, said that African countries could achieve industrialisation by focusing their efforts on locally available commodities and by developing local entrepreneurs and industrialists.
Chief Obasanjo was addressing participants during seminars of the African Export-Import Bank (Afreximbank’s) Advisory Group on Trade Finance and Export Development in Africa, organized as part of activities marking the Bank’s 23rd Annual General Meeting of Shareholders (AGM).
The former President said that African countries should add value to the commodities they produce rather than export them raw and unprocessed and that African governments should make opportunities to engage in industrialization and local production open to all entrepreneurs wishing to take advantage of such opportunities.
Highlighting the need for even-handedness in dealing with local entrepreneurs and industrialists, he argued that, with the right support, African businesses could move out and compete effectively in a globalized world.
Prof. Justin Lin, a former World Bank Chief Economist and Director, New Structural Economics at Peking University, China, said that African countries could grow as dynamically as the successful countries in East Asia and other parts of the world if there were facilitating governments with pragmatic industrial policies and functioning special economic zones and industrial parks.
Prof. Lin, who is also Honorary Dean of the National School of Development at Peking University, said that such an approach would enable Africa to capture the window of opportunity presented by the upcoming relocation of millions of labour-intensive manufacturing jobs from China as a result of increasing wages there.
According to him, diversification and continuous industrial upgrading are the path to prosperity and pragmatic industrial policies, special economic zones and industrial parks are useful tools for such industrial upgrading and structural transformation in Africa and other developing regions.
“The dynamic growth and rising wage in China provide a great opportunity for other developing countries to jumpstart their industrialization and dynamic growth,” argued Prof. Lin.
In his contribution, Prof. Joseph Stiglitz, a Nobel Prize winner in economics and Professor at Columbia University, urged African countries to reduce the barriers to intra-African trade as such trade offered enormous opportunities for Africa’s economic development.
Prof. Stiglitz said that such barriers included infrastructure and other tariff and non-tariff barriers. He noted that many African markets were too small to have economies of scale and argued that through intra-African trade, they would be able to take advantage of the economies of scale.
He stressed the need for economic diversification as a path to growth in Africa, including education and industrialization. In his view, with the magnitude of the population growth expected in Africa in the near future, the continent must think about doing a lot more than just industrialization.
Another speaker, Helen Hai, a UNIDO Goodwill Ambassador and CEO of the Made in Africa Initiative, urged Africa to focus its industrialization on producing for the export market because of the small size of the African market, which currently constituted only two per cent of the global market.
She highlighted the role of industrial parks in powering Africa’s industrialization, saying that it was easier to provide necessary infrastructure within an industrial park than for an entire country in a situation of limited resources. Those industrial parks would then serve as inspiration for more to be built, bringing about more development.
Subjects covered in panel discussions during the day’s seminar sessions included: “Industrial parks and special economic zones as options for accelerated industrial development – Lessons from successes and failures”; “Riding the rollercoaster: Managing the commodity boom-bust cycles”; and “Optimum strategy for Africa’s industrialiastion: Moving up the value chain for key commodities”.
Earlier in the day, Michael Benstrong, Minister of Investment, Entrepreneurship Development and Business Innovation of Seychelles, declared open a trade exhibition organized as part of the AGM activities, while Denys Denya, Afreximbank Executive Vice President for Finance, Administration and Banking Services, delivered an opening statement.
Also today, the AGM events featured an investment forum focused on investment opportunities in Seychelles.
Among those still scheduled to address participants during the four days of activities are Tony Elumelu, Chairman of Heirs Holdings ltd., Nigeria; Ahmed El Sewedy, President of El Sewedy Industries, Egypt; Lucien Ebata, CEO of Orion Group; and Dr. Paul Fokam, Chairman of Afriland First Bank Group.