Financial and Economic experts examining an ongoing study of key factors underlying development in Africa have emphasized on the need for the continent to sustain annual growth rates of at least 7 to 10 percent over the next 40 years if Agenda 2063 is to be met.
The session, organized by the Africa Union Commission and the African Development Bank, was held on the sidelines of the 36th African Union Summit in Addis Ababa, on the theme “The study on Key Actions to Drive Inclusive Growth and Sustainable Development in Africa.”
The event was commissioned by the Chairperson of the African Union Commission, Moussa Faki Mahamat and African Development Bank President, Dr. Akinwumi Adesina.
According to the Chairpersons, the study will undertake a deep analysis of Africa’s growth trajectory and identify key actions for Africa to double its growth rates from the current level for the next 40 years.
Agenda 2063, set by the African Union, is Africa’s roadmap and master plan for transforming the continent into the global powerhouse of the future.
Prof Kevin Urama, the Acting Chief Economist and Vice President of the African Development Bank, outlined the rationale for the study as “Africa’s current growth performance is insufficient to eradicate poverty and achieve the Sustainable Development Goals (SDGs),” adding that Agenda 2063 is encapsulated in the African Development Bank’s ‘High 5’ priorities.
Albert Muchanga, AU’s Commissioner for Economic Development, Trade, Tourism, Industry and Minerals at the African Union, moderated the session which lasted for around 90 minutes.
In a message read on his behalf, President Hakainde Hichilema of Zambia said he had no doubt that Africa would overcome poverty and expected nothing less than recommendations fit for purpose.
“What we can do collectively in getting the African economy to grow can no longer be seen as a pipe dream.”
Albert Muchanga
Each speaker affirmed their belief that sustained development is within reach. They cited China as an example of a development strategy incorporating inclusive growth, that had propelled the country from a developing nation to a superpower within 40 years.
Hurdles Hindering Africa’s Economic Growth
According to Prof. Urama, the study will take a comprehensive look at the checkered growth trajectory of African economies and find the reasons for flatlining.
“No African country has achieved consistent growth rates for decades-long growth. Why the inconsistencies, and what are the drivers of rise and fall?
“We need new financial models’ novel approaches to address them. Redistribution of resources is inevitable.”
Prof Kevin Urama
Sharing examples from Angola, the country’s Finance minister Vera Daves de Sousa said progress meant commitment.
“In Angola, the government is totally committed to removing obstacles improving the businesses environment beginning with the political environment.”
Vera Daves de Sousa
Other requisites, according to de Sousa, were tackling excessive bureaucracy and promoting human capital development as a main pillar of the country’s development plan.
Columbia University professor and economist, Jeffrey Sachs, noted that increasing and sustaining investment from the current level of 20% of GDP to 40% would require a deep quantitative exercise and a development strategy promoted by strategists. “This is Africa’s challenge,” he stressed, adding that infrastructure and human capital development would be critical.
Hanan Morsy, the Deputy Executive Secretary and Chief Economist at the United Nations Economic Commission for Africa averred that Africa needed macro-economic stability.
“The continent must scale up the production value chain, not just export raw materials.”
Hanan Morsy
Other speakers listed additional obstacles the continent faces, chief among them is the cost of capital to achieve the infrastructure expenditure required for growth, the bulging youth population, and the need to fast-track technology innovation and skills.
After further stakeholder consultations, Prof Urama in his final speech divulged that the study will inform recommendations for a development blueprint to help transform Africa’s economies and eradicate poverty. “It is expected to be finalized in December 2023,” he said.
