Infrastructure development is pivotal, as we work to create necessary transport links for diversifying into sectors like agroindustry and processing - Paul Akiwumi
Paul Akiwumi, Director of the Division for Africa, Least Developed Countries and Special Programmes at the UN Conference on Trade and Development (UNCTAD), visited New York in September to promote his organization's new High Impact Initiative, Transforming4Trade. Africa Renewal's Kingsley Ighobor discussed this initiative and its benefits for African countries with Mr. Akiwumi. Here are excerpts of their conversation: -
You travelled to New York, in part, for the launch of Transforming4Trade, an initiative aimed at changing Africa's trade and economic structures. Can you tell us more about this initiative?
To engage in international trade, a country must produce continuously more advanced and technologically complex goods or services. This initiative revolves around achieving structural transformation through a holistic approach to economic development, not through traditional models such as commodity or sectoral dependency.
Our event highlighted the success of our pilot programme in Angola, where we have been operating for seven years now. We have successfully helped to steer the country towards its core national development objective of diversifying the economy away from oil dependence.
Our efforts have supported the reform of numerous policies, helped identify new avenues for diversification and concretely supported the development of competitive value chains, increased support for entrepreneurship, exploring regional and global value chains, improved capacities for trade negotiations and meeting international standards for exports, and assisted with trade logistics, among others.
Additionally, we have contributed to formulating new investment and industrial policies that connect these vital components.
Infrastructure development is pivotal, as we work to create necessary transport links for diversifying into sectors like agroindustry and processing.
In our pilot programme in Angola, we've successfully helped to steer the country towards its core national development objective of diversifying its economy away from oil dependence
Why did you choose to showcase Angola's success in New York?
The Angola case is a demonstration of the profound results and impact that can be achieved through the implementation of an evidence-based, holistic, and multi-sectoral approach to economic development, with a long-term vision.
We are actively seeking new partners.
Our aim is not only to spotlight our approach, but also to announce that we have recently launched similar initiatives in Kenya and Ethiopia.
We also have plans for Mozambique, Malawi, and Zambia. In fact, I will be in Zambia in October to launch an initiative there.
Is this initiative aimed exclusively at African countries?
No, it is a global initiative. We have plans for more countries like Honduras. Enhancing productive capacity is a universal concern, and our holistic approach offers an interconnected perspective on productive development.
During our New York event, we received interest from more than 20 other countries, indicating a growing global interest.
Our goal is to have a significant number of countries participating in this initiative by 2030.
Are any African countries among the 20 expressing interest in your initiative?
Yes, we have significant interest from African countries, including Nigeria, where we are currently active.
In addition to the National Productive Capacity Gap Assessment, we are exploring a more detailed approach in Nigeria, working at the state level. With this level of detail, the government can gain insights into the productive capacities of individual states and target its policies to foster the production of goods and services more effectively.
Many women-led businesses are part of our entrepreneurship programme, which actively supports their empowerment
We are also taking on a regional perspective, assessing productive capacities across Regional Economic Communities like ECOWAS and SADC.
How do you engage with these countries?
We collaborate with individual countries bilaterally, and through regional organizations like the African Union. Our engagement strategy depends on the specific constraints identified within each country.
We use a data-driven index, the Productive Capacities Index (PCI), to pinpoint the challenges. Subsequently, we conduct a gap assessment to uncover constraints, opportunities, and gaps. Based on this assessment, we tailor a comprehensive programme to address key issues.
Have you assessed the actual impact of this initiative?
To a considerable extent, yes. Our entrepreneurship programme, for example, has successfully supported entrepreneurs, assisting them in developing business models and entering new sectors.
In Angola, 30 out of the top 100 private companies have undergone our process, with 85 per cent of them reporting increased sales. Additionally, a 72 per cent yearly job growth rate can be observed in these enterprises.
On an institutional level, our support for the private sector's ability to export such products as honey has prompted the development of certification frameworks and infrastructure within the country.
Angola's labs are now better equipped to handle certification, including phytosanitary standards, not just for honey but also for various agro-processing products.
How does this initiative align with the goals of the African Continental Free Trade Area (AfCFTA)?
The initiative strongly aligns with AfCFTA.
Our initiative works to build the capabilities of countries across the value chain. For example, if Angola produces honey but not the glass jars needed for packaging, another African country may step in to fill that gap.
Without tariffs or duties under AfCFTA, countries can trade, process, certify and export these products freely.
Global trade involves multiple countries. Are you supporting not only Angola but its trading partners as well?
Yes, that is a crucial aspect. Remember, our initiative complements rather than substitutes national development strategies. It also aligns with the broader efforts of the United Nations. Our approach is demand-driven we respond to countries' requests for assistance.
Collaboration among countries is key. Consider the automobile industry, where different countries may produce various components. By working together and enhancing their capabilities, they could manufacture all the components within the African continent and freely trade them under AfCFTA. The same applies to the pharmaceutical industry.
In our Economic Development in Africa report 2023, we mapped the technological capabilities of various African countries. With free movement across the continent, countries could harness these capabilities collectively.
To a considerable extent, yes. Our entrepreneurship programme, for example, has successfully supported entrepreneurs, assisting them in developing business models and entering new sectors.
In Angola, 30 out of the top 100 private companies have undergone our process, with 85 per cent of them reporting increased sales. Additionally, a 72 per cent yearly job growth rate can be observed in these enterprises.
On an institutional level, our support for the private sector's ability to export such products as honey has prompted the development of certification frameworks and infrastructure within the country.
Angola's labs are now better equipped to handle certification, including phytosanitary standards, not just for honey but also for various agro-processing products.
How does this initiative align with the goals of the African Continental Free Trade Area (AfCFTA)?
The initiative strongly aligns with AfCFTA.
Our initiative works to build the capabilities of countries across the value chain. For example, if Angola produces honey but not the glass jars needed for packaging, another African country may step in to fill that gap.
Without tariffs or duties under AfCFTA, countries can trade, process, certify and export these products freely.
Global trade involves multiple countries. Are you supporting not only Angola but its trading partners as well?
Yes, that is a crucial aspect. Remember, our initiative complements rather than substitutes national development strategies. It also aligns with the broader efforts of the United Nations. Our approach is demand-driven we respond to countries' requests for assistance.
Collaboration among countries is key. Consider the automobile industry, where different countries may produce various components. By working together and enhancing their capabilities, they could manufacture all the components within the African continent and freely trade them under AfCFTA. The same applies to the pharmaceutical industry.
In our Economic Development in Africa report 2023, we mapped the technological capabilities of various African countries. With free movement across the continent, countries could harness these capabilities collectively.
Structural transformation will lead to ... more high-tech employment opportunities for our youth
How have you ensured the sustainability of this initiative?
First and foremost, countries totally own the programme, and each must establish its own dedicated governance structure, including a steering committee representing all relevant ministries.
For example, in Angola, this committee consists of several cabinet ministers, representing up to 23 ministries involved in programme implementation, who convene biannually to oversee the programme.
Additionally, a technical committee, with members from all ministries, supports implementation efforts.
Also, the private sector, academia and civil society representatives are involved in relevant meetings and consultations. They are some of the key interlocutors on the ground.
UNCTAD, jointly with its Centers of Excellence, extended partner networks and sister UN agencies, provides technical support.
Over time, the initiative will become part of the normal work of government ministries, private sector entities and university curricula.
Does this initiative address green technologies?
Yes, it certainly does. Africa possesses minerals crucial for the global transition to green energy.
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- Africa has an imperative to add value to these minerals instead of exporting them as raw materials. For instance, using green energy to process cobalt within Africa is more environmentally friendly than sending it to another continent for processing with carbon-emitting energies. For such processes, Africa should leverage its abundant green-energy resources.
- Furthermore, Africa must adopt green technologies to remain competitive. This is increasingly important as countries progressively adopt and implement policies to address climate change, especially those that use trade policy as their main instrument.
- Africa must also invest in green technology to lower its emissions and avoid such penalties when exporting outside the continent.
How receptive are countries to women's empowerment in your initiative?
Women's empowerment is an important aspect of economic development. Many women-led businesses are part of our entrepreneurship programme, which actively supports their empowerment.
The creative economy, prominent in Africa with industries like Nollywood, greatly benefits from women's contributions.
In sectors like tourism, where women play significant roles, we strive to ensure that they have equal opportunities to maximize their contributions to their national economies and to their own well-being.
While many economic sectors remain male-dominated, we have employed creative solutions to increase women's participation.
Our analyses fully integrate the gender perspective and consider other specific groups that require particular attention, such as youth. Policy recommendations, therefore, target issues and practices that can help to empower women and marginalized groups.
What would you consider successful outcomes for the continent?
Two developments are critical: -
- First, Africa must fully operationalize AfCFTA. Countries are currently aligning their policies with AfCFTA, and we must prioritize its implementation. Taking advantage of the vast African market can drive structural transformation.
- Second, Africa must add value to its raw materials, particularly as the world seeks critical minerals for transitioning to renewable energy. We cannot afford to continue exporting minerals found predominantly in Africa as raw materials.
Within the next five years, I envision Africa organizing itself to add such value to these resources, providing the world with essential inputs for developing renewable energy.
This transformation will lead to decent jobs, increased income, improved social services and, importantly, more high-tech employment opportunities for our youth.
I am optimistic.
