London — Industrialization in Africa is not only possible but desirable, Economic Commission for Africa Executive Secretary, Mr. Carlos Lopes, said Friday.
In a keynote address to delegates at the London School of Economics' Africa Summit, Mr. Lopes said even though sceptics were many, what was clear on the ground was that the continent is ready for industrialization.
"It will happen, nevertheless, only if strong industrial policies do promote them. This requires bold leadership and a very prominent role for the State," said Mr. Lopes.
"The current megatrends in Africa suggest that the continent is ripe for structural transformation. Africa is endowed with an abundance of natural resources which provides an opportunity for value addition and commodity-based industrialization."
Furthermore, he said, the continent has an abundant and youthful population which, if effectively harnessed, will constitute a pool of productive labour for emerging industries with the rapid pace of urbanization on the continent adding to the impetus for industrial development.
Infrastructure spending in Africa has risen by $25 billion since the early 2000s and currently accounts for 4 percent of GDP.
"Notwithstanding these trends, the continent has not fully capitalized on its potential for structural transformation," he said.
"African countries need to do more to diversify their economies and develop the productive capacities of their youthful and abundant labor force to realize the demographic dividend and achieve structural transformation."
The Executive Secretary passionately spoke about Africa's development saying structural transformation should be driven from increased agricultural productivity, industrialization or natural resources value-addition, all the way to smart urbanization and inclusive social models.
"As latecomers to this process, an effective structural transformation for Africans means making significant productivity gains in rural areas with vibrant hubs of agri-business and linkages across industrial activity; the translation of Africa's youth bulge into a demographic dividend; access to social services that meet minimum standards of quality regardless of location; reduced inequality - spatial and gender; and progression towards an inclusive green growth trajectory," he said.
This, Mr. Lopes added, was the reason the ECA advocates for an inclusive structural transformation agenda that is anchored by the three dimensions of sustainability; economic, social and environmental.
Noting that the developed world adopted protectionist policies in the earlier stages of their economic development, Mr. Lopes told summit delegates active government interventions were required to promote inclusiveness of the growth process and to minimize the environmental costs of industrial development.
African countries should also pay attention to the possibility of upgrading, not just through the development of physical production capabilities but also through the development of producer services, such as design, marketing, and branding, he said.
Mr. Lopes also participated in a panel discussion on illicit financial flows at the LSE. The sought to provide a thorough understanding of the causes and effects of illicit financial flows from Africa, the modalities and the role of domestic and international policies and laws towards curbing the practice.
The LSE Africa Summit is an anuual meeting that bring researchers, policy makers, academics and experts together to showcase Africa and discuss challenges and issues facing the continent.
After the Africa Summit, Mr. Lopes went to Chatham House where he launched one of the ECA's latest publications, "Transformative Industrial Policy for Africa", which aims to serve as a guide for supporting member states on industrialization.
