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“Major economic progress is possible in Africa and can lead to improvement in the standard of living but we must work on structural transformation so that Africans can benefit from their economies,” declared Germaine Kambinga Katomba, Minister of Industry in the Democratic Republic of Congo, during the joint launch of the Mutual Review of Development Effectiveness Report and the Africa Competitiveness Report 2015.
Katomba said Africa has improved its competitiveness and has reduced inequality and poverty, but its focus should remain on transformation that will have a tangible impact on these factors. Despite the growth many African economies experience, gender inequality, a fact which slows growth and productivity, persists, he said.
The Minister was “happy to have confirmation from the two reports that industrialisation is one of the triggers of economic improvement. He concluded by launching an appeal to place African economies on the same footing as European economies and recognising their dynamism, which will also make them more competitive.
The Mutual Review of Development Effectiveness Report (MRDE), produced by the Economic Commission for Africa (ECA) and the Organisation for Economic Co-operation and Development (OECD) says Africa made achievements in democracy and good governance, but is still struggling to attain structural transformation and industrialisation, explained Adam Elhiraika, Director of the Macroeconomic Policy Division at ECA.
Focusing on sustainable growth, investments in people, good governance and financing for development, Elhiraika, who moderated the launch, said the report proposes a focused industrialisation and investments in manufacturing.
The African Development Bank (AfDB) and World Economic Forum’s Africa Competitiveness Report (ACR) concludes that Africa needs self-sufficiency and innovation to improve its competitiveness, said Audrey Verdier-Chouchane, Chief Research Economist at AfDB. The report proposes that the private sector has to be engaged in a new way and domestic resources need to be scaled up, she said.
The report also mentions environmental sustainability, climate change and debt sustainability as some of the areas which needed more work.
Verdier-Chouchane stressed the need for an innovative approach to enhance competitiveness. "In the next decade, African countries must focus on infrastructure development and increase productivity to improve their performance," she said. “We should build on infrastructure and services.”
According to Verdier-Chouchane, the 2015 report found productivity has declined in Sub-Saharan Africa in the past decade.
For Issa Faye, Manager of the Research Division at the AfDB, capacity investments in the social sector will support the programs of development of human capital in general and job creation, including food, education and skills development, and social safety nets.
Commenting on both reports, Professor Frannie Leautier, Chief Executive of Mkoba Equity Fund, proposed that African economies aspire to “sustain growth, innovate and scale up.
“Access to financing and corruption are the leading forces in lack of competition,” she added.
The Mutual Review of Development Effectiveness Report is produced by the Economic Commission for Africa and the Organisation for Economic Co-operation and Development. The African Competitiveness Report is produced by African Development Bank and the World Economic Forum.