Say African countries spend more annually on debt servicing than education, healthcare
Nigeria’s former finance minister Mrs. Ngozi Okonjo-Iweala has emphasised the need to diversify the economy through strengthening the manufacturing sector.
Okonjo-Iweala disclosed this at a recent virtual roundtable hosted by the New York Forum Institute and organised by Tony Elumelu, Chairman of the pan-African bank, United Bank for Africa Plc, UBA.
Other facilitators who spoke at the roundtable, Tidjane Thiam, African Union Special Envoy on Covid-19, harped on the need to create more jobs on the continent.
Also, the moderator Vera Songwe, Executive Secretary of the United Nations Economic Commission for Africa, UNECA, stated that the African Continental Free Trade Zone may just be the policy needed to kick starts the transformation – this is the best time to achieve it.
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Speaking on the topic “Resilient World: An African Call for a New World Order,” at the New York Forum Institute Virtual Roundtable, they jointly noted that, many African countries already spend more annually on debt servicing than on education, healthcare and social welfare combined
For Elumelu, prioritising the youth, ensuring access to electricity, and stabilising the macroeconomic environment are additional focus areas needed at this time.
A Task to Reset Africa Calls for a Marshall Plan
According to them, “Mobilising the level of finance that will give Africa room to begin this hard task of resetting, will require a Marshall plan, akin to America’s Marshall Plan for Europe after World War II. This Marshall Plan for Africa will be in collaboration with the World Bank, IMF, G20 countries and all other relevant agencies but must be led by African multilateral financial institutions as in the case of AFREXIM under the leadership of Prof. Okey Oramah, whose efficient and immediate deployment of US$3 billion to finance and support trade and SME business through African banks, is commendable and deserves emulation.
“The Covid-19 pandemic presents a bittersweet moment of clarity and reflection which we must seize to reset our continent. It provides the opportunity to finally place Africa on the right path of sustainability built on the bedrock of competitiveness”.
Sustained Investment in Infrastructure
“We can engender African competitiveness by sustained investment in basic infrastructure, electricity, internet access, and digital connectivity, and most importantly by enabling and encouraging entrepreneurship. This combination will provide economic hope and opportunity that will productively engage our young Africans who account for over 60% of our 1.3b population. This is the only way we can reset the economy, create employment, eliminate poverty, generate revenue, and attract capital to the continent.
Be Ready for Disruption
“Africa must embrace the new normal. The disruptions we have seen across sectors, healthcare, logistics, supply chain, digital economy, IT, are here to stay. This presents a unique opportunity for a united Africa, a strong regional bloc acting in a coordinated fashion in response to this new era. As globalisation, trade and foreign policy adjust in response to these times, Africa will only enjoy more traction, increased leverage, and more influence by forging a united front.
“This is the time for the continent to fully leverage its competitive advantage in agriculture, through focused investments in mechanisation, storage facilities, logistics, pest control, quality assurance, and processing, while strengthening our expertise in textile, manufacturing, supply chain among others.
“In truth, disruption is here. It may not be ideal, but disruption, in the many facets it presents itself, has heralded new eras, and economic powers. If Africa treats this pandemic as a warning and begins to put in place the systems to ensure economic stability, this could be the beginning of the next global economic power, all business leaders agreed.