‘Infrastructure key to greater integration’
Windhoek – African economies face difficulties in sustaining the current pace of economic growth due to under investment in infrastructure and committing to integrating their economies.
Delegates to the African Economic Conference (AEC) in Johannesburg, South Africa this past week were unanimous on two key issues: Africa should speed up integration of its economies; and that the current pace of growth, if unmatched by investments in infrastructure – particularly in energy – would in the long-run be unsustainable.
Whilst African economies have made progress towards integrating their economies and boosting intra-regional trade, “the pace is probably a little slower”, African Development Bank (AfDB) President Dr Donald Kaberuka said at the conference opening.
What could not be mistaken from the presentations of key speakers at the conference was disenchantment with the slow pace of integration and lack of investment in infrastructure across Africa.
Dr Kaberuka said integrating African economies and boosting investment in infrastructure buffered the continent “against external shocks” and “business as usual will not do”.
“There is a strong conviction that although many countries have done well in the last decade, that momentum will be hard to sustain without a quantum leap on integration,” Dr Kaberuka said.
Integrating economies while investing in infrastructure should be prioritised, the AfDB boss urged.
“At a time like this of weak global demand, with so much volatility, so many unknowns, the real cushion, the engine is Africans’ internal market,” Dr Kaberuka said. “The parlous state of the global economy calls on us to build internal resilience, unlock Africa’s one billion market, creating conditions for joining the global higher value chains.”
He added: “For those who will say, but this requires vast amount of financial resources, I would agree. But Africa is investing its half a trillion dollar savings abroad from its newly discovered wealth such as oil, gas etc. and under current market conditions, faces limited returns.
“But, in any case things we have to do for the deeper integration of Africa do not always need money.
“Rather the implementation of the commitments we entered into, from movement of people, and shared services to joint centres of excellence. These are times for strategic decisions on where Africa goes next.” Similar sentiments were expressed by Dr Nkosazana Dlamini-Zuma, the Chair of the African Union Commission, who said governments were still grappling with the challenge of “soft integration issues such as harmonisation of policy” and “movement of goods and services”.
Dr Dlamini-Zuma said countries need to address the issue of overlapping membership of regional blocs and should have collective ownership of the integration process to facilitate better implementation.
“Integration of the regional economic communities is much slower than expected, with continued duplication of planning and processes.
“There is a need for greater co-ordination on key issues where our collective strength and pooled expertise and knowledge would make a considerable difference,” she said. Other speakers said leaders were merely paying lip service to enhanced integration.
“In order to realise the benefits of regional integration, our leaders should view these arrangements as more than sound bites in economic and politics and dedicate the effort to make them work,” Abdalla Hamdock, Deputy Executive Secretary of the UN Economic Commission for Africa said.