By Gugu Mahlalela
JOHANNESBURG – SADC member states have been advised to collectively promote investment in order for the region to realise the industrialisation dream.
This was the advice given to the regional bloc during the 2nd SADC Industrialisation Week that started in Johannesburg, South Africa on Monday.
The weeklong event was held under theme “Partnering with the private sector in developing industry and regional value chains”.
In his opening remarks South Africa’s, director general in the Ministry of International Relations and Cooperation, Kgabo Mahoai, emphasized that the promotion of investment should be a regional collective effort.
For regional industrialisation to materialise, Mahoai said it will require the intensifying of Free Trade Area within SADC member states.
“There is also need to look at the rest of Africa for growth, and more utilisation of the Common Market for Eastern and Southern Africa,” he said.
Mahoai said the SADC Industrialisation Strategy and Roadmap (2015-2016) was adopted by Heads of State and Government in 2015 to help in addressing the ongoing challenges that Africa faces including the transitioning from a commodity-driven growth path to value adding, knowledge based industrial economies.
According to Mahoai, the strategy sets out three potential growth paths, which are agro-processing; mineral beneficiation and downstream processing, and service driven value chains.
He noted that the theme of the SADC Industrialisation Week denote the important role private sector can play driving the regional industrialisation strategy.
Hence, he then appealed to the private sector to work hand in hand with governments in order to realize industrialisation which he said will be the driving force for economic growth within SADC Region.
He said the private sector expertise coupled with the members states’ vision will bring forth the tremendous change.
Mahoai assured the private sector that the SADC region has strong regional values and share many achievements, which are strengthened by good governance.
“SADC has approved a blueprint to guide regional development through the RISPD and other mechanisms focusing on stability and economic development,” he said.
Meanwhile, SADC’s acting director of industrial development and Trade Dr Lomkhosi Mkhonta– Gama, highlighted that SADC will focus on value addition in three areas, namely mining and mineral beneficiation; agriculture and agro-processing; as well as pharmaceuticals.
“These three themes will become evident in the week, together with other themes without which industrialization would be difficult. These would be skills, infrastructure and finance”, she said.
Afreximbank, Senior Manager Gainmore Zanamwe said the private sector should be at the forefront of pushing the intra-African Trade. He said industrialisation and intra-African trade goes hand glove.
Zanamwe decried that Intra- African Trade is very low, standing at 16 percent while in Asia its’ at 51 percent, Latin America at 19 percent and in Europe it is at 60 percent. “There is a lot that needs to be done. In industrialisation the levels stands as follows; Africa 52 percent, Asia 63 percent and North America 92 percent. It was so shocking to realise that some African countries import leather for twice and even thrice the amount from overseas while there are Africa countries who also manufacture the same kind of leather,” he said.
To capitalize on the economic gains that industrialisation will bring whilst creating new jobs, the SADC region will need to reassess the education and skills requirements to cater for the fourth industry revolution (Industry 4.0) needs.
NEPAD Business Foundation, chief executive officer Lynette Chen said this will require an increased focus on developing technology and engineering skills capacity.
“These are the skills that will be required by industrialising economies and will provide new jobs with the SADC region. If our goal is to achieve sustainable economic growth and to provide jobs to more people in the region, Small Medium Enterprise (SMEs) development must become the priority for government and multinational corporations,” she said.
Chen said African SME’s have a potential to fuel the engine of economic growth and to create employment opportunities. She said a critical component of the SADC Industrialisation Strategy is to provide support to Africa SME’s by integrating them into regional value chains as well as understand their challenges in conducting cross border trade in the formal and informal sectors.
“Industry 4.0 has the capacity to allow developing nations to leapfrog and grow into stronger economies but only if they are capable o adapt and institute appropriate frameworks that will enable both the public and private sector to work jointly together in transforming key economic sectors,” remarked Chen
The SADC Industrialisation Week is an annual regional public-private engagement platform aimed at fostering new opportunities for intra-regional trade and investment.
It was hosted by South Africa’s Department of Trade and Industry and the Department of International Relations and Corporation in partnership with the SADC Secretariat and the Southern Africa Business Forum.