Sustained, inclusive and equitable economic growth is fundamental to achieving the Millennium Development Goals and the socioeconomic objectives of the New Partnership for Africa’s Development (NEPAD). This year’s Africa Industrialization Day highlights the important role intra-African trade can play in reducing poverty, increasing food and nutrition security and supporting sustainable development.
African economies are among the fastest growing in the world, yet intra-regional trade accounts only for 10 per cent of the continent’s commerce – significantly less than in other regions. Many constraints impede trade expansion in Africa: obsolete infrastructure, fragmented economic space, low production capacities, limited investment financing and high transaction costs. Eliminating these obstacles is a prerequisite to fully realizing Africa’s economic potential and helping to address the continent’s socioeconomic and developmental challenges. Healthy intra-African trade can free the continent from its reliance on international aid and improve its resilience to macroeconomic and other external shocks.
Industrialization can help the expansion of intra-African trade by supporting a more diversified export economy. In particular, the development of rural and food processing industries could help to lift significant numbers from poverty. But, to facilitate trade in goods and services, it is essential to reduce distribution costs by improving and expanding road, rail and other communication infrastructure. Also, industrial growth will require greater and more reliable supplies of energy. Improved energy infrastructure -- including investments in renewable power generation and energy efficiency -- would allow countries to produce more, and more competitively.
At the Rio+20 United Nations Conference on Sustainable Development in June, Governments emphasized the importance of paying more attention to Africa’s development needs. On this Africa Industrialization Day, let us heed this call.
By working together to accelerate Africa’s industrialization and boost intra-African trade we can ensure a more prosperous and sustainable future for all the continent’s people.