2 November 2012

Africa Leaders Challenged On Trade for Inclusive Growth

African countries should put trade on top of the agenda in their bilateral agreements and invest heavily in education and research if the continent is to register inclusive growth.

This is the message from some experts and policy makers attending the ongoing African Economic Conference in Kigali.

According to experts, many African countries are challenged by luck entrepreneurial skills, low productivity and limited resources, which require reforms in education sector.

Donald Kaberuka, the President of the African Development Bank urged African leaders to invest in quality education in order to stop children from inheriting poverty from generation to generation.

"This how you stop children from inheriting living conditions of debt, and once you do that you have stopped the transmission of poverty," said Kaberuka.

It was also observed that the continent is challenged by lack of proper infrastructure which leads to high transport costs and high taxes that do not encourage small exporters.

Hlengiwe Mkhize, South Africa's Deputy Minister of Economic Development stressed that trade policies and incentives should be clear to encourage entrepreneurs.

"Trade is not politics where you say it will happen, mindset for trade should start in primary education because Africa is challenged by mindset that need to be changed early," she said.

"Our economies are different but we can all invest in quality education to bring up high end Engineers who will enable Africa to compete".

Africa needs to increase intra-trade movements-which currently stand at 11 per cent and the lowest when compared to other continents.

"Africa has its own comparative advantage, let's embark on processed products that bring more returns to government and reduce disparities," said Mkhize.

She said that her country (South Africa) has invested millions of dollars in nurturing young graduates from different sectors.

Participants however emphasised the need to improve agricultural productivity as the catalyst in expanding trade for inclusive development.

Despite the widespread flow of productivity enhancing agricultural technologies the world over, agriculture in Sub-Saharan Africa has typically stagnated.

Lack of expenditure on agricultural research and development, both at the international and national levels may have reduced high-yielding seed productivity and consequently adoption of such seeds in Sub-Saharan Africa relative to other developing regions.

"A lot of African countries have implemented the Maputo declaration to increase agriculture budget to 10 per cent but where is this budget going, may be in salaries because it's not reflected into extension," said Innocent Matshe from African Economic Research Consortium

He cited out areas which would contribute to structural transformation in Agriculture including, research and development, opening up the model to push for effects, productivity, rural infrastructure, research in soil quality and seed.

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