Creating Sustainable Trade and Growth in Africa

By Ofon Udofia & Dennis Aribido

Clean and efficient KILN technology for Fish drying.

In September, at the just concluded UN General Assembly (UNGA) in New York, member countries considered the post-2015 development agenda and adopted the Sustainable Development Goals (SDGs) — a successor of the MDGs. This commitment signals a critical need to finding a sustainable and innovative solutions to the world’s ever increasing challenges. Starting 2016, the 17 proposed goals are expected to be achieved by the year 2030. However, goal-9 focuses on Industry, Innovation and Infrastructure and seeks to build resilient infrastructure, promote inclusive and sustainable industrialization and foster innovation. About 80% of the SDGs are infrastructural goals which require US$6 trillion in funding for the next 15years. According to report by multilateral development banks, the current global funding for infrastructures stood at US$1.7 trillion and 60% of the SDGs and their funding are to be borne by developing countries.

Despite the robust growth in Africa over the last decade, many Africans still do not have access to basic and affordable infrastructure services. The lack of transparency and accountability, corruption, poor infrastructures, inconsistency in policy and regulatory framework are major challenges. Also the hostile business environment in some countries remains a barrier for small, medium-sized enterprises (SMEs) to thrive. In the World Bank Ease of Doing Business rankings, only three African countries of Mauritius, South Africa and Rwanda were among the first 50 countries. This clearly begs the question: Is Africa ready for a sustainable trade and economic growth?

To unlock Africa’s potential and for it to play a competitive role in the global space, innovative solutions are critical to delivering sustainable development in infrastructure and creating viable industry. Trade and investment must be on the front burner of governments, business actors as well as the need to reduce regional border barriers and open up the markets. In Africa, most new exporters find it difficult to cross the survival huddles after the first year and even harder to gain sustainable global business access. Harnessing greater synergy in cross-border trade will boost agribusiness and make export markets accessible to farmers.

The need for regional governments integration and intervention cannot be over-emphasized. The sub-regional economic bodies like the Economic Community of West Africa States (ECOWAS), Common Market for Eastern and Southern Africa (COMESA) have played pivotal roles in advancing economic agenda and common trade within the sub-regions. And it has led to free cross-border movement of trade and investment resulting into jobs creation, infrastructural development and poverty reduction. But they need to deepen trade progress and build capacity to meet business expectations and emerging markets’ economic realities.

Côte d’Ivoire, an ECOWAS member country, has made significant progress in improving conditions for a sustainable development with GDP growth rate averaging double digit of 9% to 10% in 2014. It carried out series of reforms in critical sectors there by creating improved business climate. World Bank’s Doing-Business ranked Côte d’Ivoire among the 10 best reformers two years in a row (2014 and 2015). Ivorian government is aiming to become an emerging country by 2020 through its National Development Plan (PND) for the period 2012–2015.

Again, Rwanda, a COMESA member is making a giant stride in its quest to becoming Africa’s investment destination of choice. In the Rwanda Economic Update (REU) report, the World Bank projected an economic growth rate of 7.4%, 7.6% in 2015 and 2016 respectively. Accordingly, it projects Rwanda’s poverty rate to fall to 54% by 2016 whilst lifting approximately a million of its population out of poverty. The growths recorded were made possible by greater commitments to clear reforms and policy direction, friendly investment climate and adoption of innovative approach to governance (e.g. the deployment of technology for e-government initiatives in key MDAs of government). This approach has also plugged the avenues for corruption and reduces it susceptibility.

In Nigeria, for example, lack of sustainable technology, access to finance and export markets inhibit SMEs growth. As such, the Institute of Export Operations and Management (IEOM) is helping fish farmers in the Niger Delta region, by training and improving their skills in the use of clean and efficient (KILN) technology for fish drying. This has further enhanced the post harvest preservation, meeting market specifications and adopting best practices across the value chain.

We collaborated with stakeholders in the area of ICT and pioneered a technological initiative that helped farmers, agribusiness owners market and sell their farm products using an e-commerce trading platform called agricstores.com where sellers and buyers meet to carry-out transaction. We adopted innovative technology as a solution to eliminating barriers, driving competitiveness and opening a new frontier market for SMEs and entrepreneurs.

This week, as policymakers, representatives of trade support institutions and businesses gather in Doha, Qatar for the 15th World Export Development Forum (WEDF) organized by International Trade Centre (ITC) to deliberate on the theme: “Sustainable trade: Innovate, invest, internationalize’’, the topic is apt to finding sustainable solutions to the current global challenges. Africa must resolve to solve it challenges, remove trade barriers, trade with Africa and domesticate best practices. It also reminds us of the need by key actors to conclude the Doha Development Round, as it would facilitate and significantly increase sustainable global trade and inclusive growth.

O.E. Udofia is the Executive Secretary/CEO, Institute of Export Operations & Management (IEOM) where Dennis Aribido is an Adviser and Program Coordinator. Further information visit: www.ieom-ng.org