The New Times (Kigali)

21 May 2014

Rwanda: Commercialise Agriculture to Diversify Export Base - Expert

Africa and Rwanda in particular need to diversify the export base and promote commercial agriculture to ensure sustainable growth, experts have said.

Prof. Justin Lin of Peking University in China, said developing pragmatism in the manufacturing sector while tapping into regional markets will transform Rwanda and Africa generally.

Lin who was reacting to the new Africa Transformation Index 2014 released on Monday at the ongoing 49th Africa Development Bank Annual Meetings in Kigali, said export diversification and giving incentives to investors in agriculture will boost Africa's production capacity.

"You have to develop sectors that can be competitive, produce high-end goods by tapping into modern technology to be able to create jobs and economic development on the continent," Lin said.

Dr Yaw Ansu, a chief economist at African Centre for Economic Transformation, urged the continent to promote regional and intra-regional trade.

"Macro-economic stability, public private sector partnerships and strengthening of financial sector players to boost domestic saving is what African economies like Rwanda need to transform economically," Ansu said.

He added that African universities should promote research and conduct business training programmes to foster an economic environment that will turn Africa's youth into prosperous innovators.

The chief economist at the African Development Bank, Prof. Mthuli Ncube said political leadership will play a critical role in transforming Africa's economies.

"The importance of leadership is critical if you have to attain economic excellence. There is need to strategise and focus on productivity, while building cluster industries that can support investments," Ncube said.

Experts also urged governments to focus more on the agriculture industry so as to achieve economic excellence.

According to the exports, scaling up investments in the agriculture sector will not only contribute to economic growth but also address the challenge of food insecurity on the continent.

"The need to increase productivity while creating agro-processing linkages through local innovations is paramount to the continents growth. We must strike a balance between what we are exporting and what we store for the continent to fight food insecurity," experts said.

They also called for massive land reforms to make the sector more attractive to investors.

Meanwhile, according to the Africa Transformation Index 2014, export diversification will help minimise volatility in foreign earnings and enable small economies access capital, technology and critical intermediate inputs.

Rwanda, Mozambique and Uganda made the most progress on transformation, according to the report. Each country improved its rankings by three places or more. Kenya, Madagascar, Malawi, Côte d'Ivoire, Tanzania and Ethiopia improved their rankings by one or two positions.

Ghana and Botswana were bad performers. Ghana fell seven places, while Botswana dropped five places between 2000 and 2010. Burkina Faso, Cameroon, Senegal and Zambia also dropped in rankings.

The report indicated that Rwanda and Benin improved dramatically; scoring over five aggregates in export diversification especially non-traditional exports.

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