Friday, December 17, 2010

Africa’s economic transformation agenda pushed - ACET

Africa’s growth remains modest in relation to what is possible and what is needed for rapid reductions in poverty, economic leaders from over 20 global think-thanks have observed in Accra.

Various leaders from 15 African countries and other development partners proposed that tackling the barriers to the continent’s growth requires an ambitious and comprehensive approach that focuses on shifting to economies dominated by modern industries and services, rather than reliance on low-productivity agriculture and minerals.

“In short, African countries must transform their economies; it is now time to put back at the centre of policy debate and action in Africa, the twin issues of sustained growth and structural transformation,” said the leaders at two-day workshop organised by the African Centre For Economic Transformation (ACET), as part of deliberation which will form part of a comprehensive African Transformation Report to be published in 2012.

Themed ‘The African Economic Transformation Report’, it will track performance across countries, present best practices from Asia, and examine the implications from the global trading environment for transformation in Africa.

It will be an indicator on Economic Transformation with analytical exercises providing recommendations as to how African governments can harness their expanding engagements in support of their economic transformation agendas - including the creation of jobs, development of skills, diversification of exports, expansion of investments in infrastructure and the modernisation of agriculture.

Dr. Yaw Ansu, Chief Economist African Centre for Economic Transformation, ACET, in an interview with B&FT in Accra, said: “It is now time to look seriously at how we rectify this, while also building on the gains made in macroeconomic management and the incentives framework.”

He explained that transformation enhances the scientific and technological capabilities of an economy to continually innovate and upgrade itself, including accessing, adapting, and mastering existing foreign technologies, seek solutions to new economic problems, and to respond effectively to market signals - particularly from external markets.

“Economic transformation requires investments, and it also entails economic and social dislocations that require resources to address.

“In almost all African economies, production is dominated by the primary sector in either agriculture or minerals. With the exception of South Africa and Mauritius, no country in the region has been able to establish a viable manufacturing sector that is competitive internationally in any product,” Dr. Ansu cited.

Sub-Saharan Africa is the poorest region in the world. Average real per capita income in 2008 was US$619. Over the past almost 30 years - 1980-2008 - GDP growth per capita in sub-Saharan Africa has averaged 0.15 percent compared to 2.47 percent for developing countries, 6.64 percent for East Asia, 3.76 percent for South Asia and 0.92 percent for Latin America.

This failure of growth over the long-term has resulted in high levels of poverty in the region. On average, 51 percent of the people in sub-Saharan Africa earn less than US$1 a day compared to 25 percent in the developing world as a whole.

Dr. Mwilola Imakando, Executive Director, Zambia Institute for Policy Analysis and Research, told in an interview with B&FT said: “ACET objectives will provide an opportunity for a home grown Africans to deliberate and find solutions for Africa’s numerous economic growth challenges.

Dr. K. Y. Amoako, the Founder and President of ACET and former Executive Secretary of the United Nations Economic Commission for Africa (ECA), indicated that the deliberations, which were revealing, would help refine and provide advice in helping to achieve the stated objectives of ACET and aid in transforming Africa’s stagnant economic growth agenda.

ACET was incorporated as a non-profit policy research and advisory institution in 2007. It received strong support in consultations with many stakeholders both within and outside Africa, including the endorsement of a number of African leaders.

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