The 17th Extraordinary Summit on Industrialization and Economic Diversification was held in Niamey, Niger in West Africa, an annual commemorative gathering aimed at highlighting Africa’s renewed collective determination and commitment to continental industrialization.
Several reports and brilliant speeches were delivered. But the key messages resonated at the summit relate good governance, continental unity, good strategies and finance. These the high-level speakers indicated clearly are required and largely necessary for achieving sustainable industrialization and economic diversification.
While delivering his remarks at the opening ceremony, President Paul Kagame of Rwanda has called for Africa’s economic unity saying it is more important now than ever, the collective unity is needed to move forward and with a sense of urgency, and to speed up industrial development for realizing the Continental Free Trade Area in Africa (AfCFTA).
“The pace of industrialization in Africa remains too slow to achieve Africa’s Development goals under the agenda 2063. We need to invest more in our national budgets in industrial policy, and significantly increase energy and infrastructure capacity. We must also build stronger links between our universities and the private sector, to promote a culture of innovation that includes young people,” he said.
President Kagame also chaired the closed session of the Extraordinary Summit of The African Union where leaders discussed the key next steps to achieve industrialisation and economic diversification, and the operational tools to put in place to further implement the AfCFTA. “Times have changed, and the economic unity of our continent is more important than ever. Time and time again, we are reminded of the importance of working together. No one can make it alone.” President Kagame.
Noteworthy to say here that Professor Benedict Oramah, President of African Export-Import Bank underlined the continental resolve to drive structural transformation, built around leveraging Africa’s rich and diverse natural resources, while at the same time embracing current advances in technologies, continental and global geo-political trends and emergence of tradeable services.
The African Export-Import Bank has played unique roles in several economic sectors across Africa. In the first place, the African bank offers strong financial support, engage in external fund raising campaigns and collaborate with the African Union and the AU members. Beyond that, the bank gives advisory services relating to development of various economic sectors, all these in attempts to improve the conditions, as espoused in the shared “Agenda 2063: the Africa We Want” in Africa.
With several initiatives and programmes, the Afreximbank has pursued, with courage and determination, using the necessary high-level platforms within Africa and outside Africa to drum home the necessary funds for development. What is required here for African leaders to exhibit good governance, design and implement the best policies and speak with one voice for realizing the set AU Agenda 2063.
The Afreximbank supported the first ever pooled procurement by African Union member ctates in an emergency, when it provided a $2 billion financing towards the procurement of 220 million doses of of Johnson and Johnson vaccines.
And as the Russia-Ukraine crisis rages on, the bank has also stepped up and already disbursed over $5 billion towards the procurement of food, fertilizer and grains. Beyond that, the bank is closely working with UNECA, the AU and the AfCFTA Secretariat to create a pooled procurement platform called the Africa Trade Exchange (ATEX), that is helping African countries to procure grains, edible oils and fertilizers at a much reduced cost.
The Afreximbank continues to support the implementation of the African Continental Free Trade Agreement (AfCFTA). During the five years to 2021, Afreximbank disbursed over $20 billion in support of intra-African trade and investments and plans to double this to $40 billion during the five years 2022 to 2026.
As partners, Afreximbank, the African Union Commission and the AfCFTA Secretariat have launched the commercial operations of the Pan-African Payment and Settlement System (PAPSS). It has now become possible to conduct intra-African trade payments in African national currencies. It is working with the AfCFTA Secretariat and Council of Ministers for Trade to establish the AfCFTA Adjustment Fund.
With industrialization, the bank is working with various African governments to develop and expand Industrial Parks (IPs) and Special Economic Zones (SEZs) to deal with infrastructural constraints to industrialization. These parks are ongoing across ten African countries, including two parks in Malawi and one in Cote d’Ivoire under development. It has also commenced discussions for the creation of industrial parks in DRC, Zambia, Rwanda, Kenya and Botswana.
The first-ever Africa-Caribbean Summit in 2021, Afreximbank has taken steps to accelerate the integration of the two regions. In early September, first-ever Africa-Caribbean Trade and Investment Forum which attracted over 1,000 participants from Africa and the Caribbean. In that regard, it has conducted successful trade and investment missions to the Caribbean with African corporates and banks to explore opportunities in that market. Plans are advanced towards opening an Afreximbank office in the Caribbean so that it can support Africa-Caribbean trade and investments better.
In his contribution with an aspiring speech, Dr. Akinwumi Adesina President of African Development Bank Group, also seriously underscored the fact that the African Continental Free Trade Area is the continent’s best pathway to prosperity. In order to unlock this potential, the focus is not just trading but significantly engage in industrial manufacturing.
The African Continental Free Trade Area is the continent’s best pathway to prosperity. To unlock its potential, however, we must not just trade. We must turn the zone into an industrial manufacturing zone. Free Trade Zones that launch prosperity around the world have done so not by trading low value commodities, but by industrial manufacturing.
Closely related to manufacturing is energy supply. The African Development Bank has invested over $7.5 billion in the past five years to expand access to electricity which has provided electricity for 20 million people. In order to further boost Africa’s manufacturing capacity for green energy, the African Development Bank will work with its partners to support the manufacturing of solar panels in Africa.
“Without any doubt, Africa’s wealth must no longer depend on exports of raw materials but of finished value-added products. The door to poverty is from export of raw materials, the highway to wealth is industrialization,” he stressed at the gathering.
Africa has an abundance of natural resources, oil, gas, minerals, and metals, as well as extensive blue economy that must be rapidly industrialized. But the sector with the greatest potential for industrialization in Africa is agriculture. Africa has 65% of the uncultivated arable land left to feed the world, therefore how Africa develops its agriculture will determine the future of food in the world.
“Across Africa, we must turn cocoa beans into chocolates, cotton into textile and garments, coffee beans into brewed coffee. That is why the African Development Bank is investing $25 billion in agriculture across the continent, to transform the agricultural sector, he added.
The African Development Bank is investing over $1 billion in the development of Special Agro-Industrial Processing Zones in 18 countries, to help unlock Africa’s potential in food and agriculture. This is part of our efforts to unlock the food and agriculture market estimated to reach $1 trillion by 2030.
The success of the African Continental Free Trade Area depends on closing Africa’s infrastructure deficits. The bank has invested over $44 billion in infrastructure over the past seven years, including roads, seaports, airports, digital communications infrastructure backbones, transport corridors, one stop border posts, and regional power transmission lines which are supporting regional power pools.
Under the chairmanship of President Macky Sall, the African Development Bank and the African Union Commission are organizing a Presidential Feed Africa Summit from 25-27 January 2023 in Dakar to develop action plans to fully transform Africa’s agriculture to feed itself and to contribute to feeding the world.
With the mandate to forge greater partnerships, the banks seriously working jointly to push ahead with the pan-African trade and industrialization agenda. These dynamic collective efforts are directed towards the realization of the shared developmental goals with the Agenda 2063 drawn by the African Union.
At the 12th Summit held in Niamey late November, several reports were delivered about the pace of economic diversification and industrialization across Africa. This Extraordinary Summit on Industrialization and Economic Diversification provides an opportunity to key stakeholders to reflect on Africa’s industrialization by looking at how the continent can be changed from its current status quo and accelerate actions towards Africa’s structural transformation, and to meet the ultimate objectives of Agenda 2063 and Sustainable Development Goals 2030.