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Africa must move to centre of global economy – Kikwete

Africa must move to centre of global economy – Kikwete
By Kabanda Chulu in Kitwe
Tue 11 May 2010, 04:00 CAT

PRICEwaterhouse Coopers (PwC) Zambia senior partner Richard Mazombwe has observed that Africa’s business leaders are at a crossroads between feeling confident and being weighed down by the risks of doing business in the region. And Tanzanian President Jakaya Kikwete has said there is urgent need to move Africa from the periphery to the centre of the global economy.

Releasing the PwC chief executive officer’s survey at the 20th World Economic Forum in Dar es Salaam on Friday, Mazombwe stated that 87 per cent of CEOs headquartered in Africa anticipate regional expansion in the next 12 months which is the highest percentage among CEOs headquartered anywhere in the world.

He stated that the survey and forum were important platforms for business leaders to aggregate experience and seeks clarity on the challenges as well as the tremendous opportunities of doing business in Africa.

“Africa’s business leaders are at a crossroads between feeling confident and being weighed down by the risks of doing business in the region but the survey finds that 87 per cent of CEOs headquartered in Africa anticipate regional expansion in the next 12 months, the highest percentage among CEOs headquartered anywhere in the world,” stated Mazombwe.

“Their optimism contrasts sharply with that of global CEOs, whose confidence has plummeted from similar levels three years ago, following the global downturn.”

And PwC Central Africa senior partner Philip Kinisu stated that there was a relative sense of confidence in many African countries due to the muted impact of the global economic downturn.

“And in many ways the business environment continues to improve, driven by relentless economic, social and political changes. It means businesses are increasingly focused on growth within the region and tapping new consumers in their existing markets,” Kinisu stated.

“In a sense we Africans are rediscovering Africa and growth through better penetration of existing markets is expected among 77 per cent of CEOs in Africa, compared to 38 per cent of global CEOs but South Africa differs from the rest of the continent with only 33 per cent of respondents targeting existing markets instead they are much more focused on expanding into new geographical markets.”

Officially closing the World Economic Forum last Friday, President Kikwete said despite Africa’s huge potential, the continent suffered from lack of integration in the global economy.

“If there is any predicament to African development, it is this state of affairs and it is time to move Africa from the periphery to the centre of the global economy,” President Kikwete said.

He reminded the participants that the smallest share of global exports comes from Africa just 3.5 per cent and just a trickle of global foreign direct investment (FDI) goes to Africa at 0.96 per cent and the continent is not integrated into international financial markets.

“Africa remains predominantly a primary producer and importer for industrial use. We produce what we don’t consume and we consume what we don’t produce but this cannot continue and to end the continent’s marginalisation, Africans must believe in themselves and be the change they want to see,” said President Kikwete.

And South African President Jacob Zuma said the upcoming World Cup tournament will show the world that Africa is ready to do anything.

“There were a lot of doubts and skepticism. But people who come to Africa will see that we are not just bushes and mountains. They will see how Africa is ready to do anything that can be done anywhere else in the world,” President Zuma said.

“Potential investors should act now and in a short period of time, Africa is going to be the place for doing business globally and FDI will come on its own.”

South Africa’s Sasol chief executive officer Pat Davies stated that there was no time for appropriate regulatory structure to be set up before initiating public-private partnerships.

“Focus on where there are markets and opportunities and use business to remove barriers, but give business reasonable certainty and predictability and we can create more partnerships and companies will help create regulatory frameworks by making the investment decision,” stated Davies.

And HCL Infosystems of India founder Ajai Chowdhry stated that one of the keys to unlocking Africa’s potential lies with young people, who comprise 60 per cent of the population.

“Let’s take a bunch of young people and put their minds on fire. You should believe in the demographics of Africa to make your human capital capable and entrepreneurship will happen,” Chowdhry said.

United Nations Human Settlements Programme (UN-HABITAT) executive director Anna Tibaijuka said Africa’s mindset has to change to ensure development.

“There is a role to be played by everyone. But we cannot afford to have more than half our population underutilised and 60 per cent of young people left behind. Follow up and follow through with local action for regional and global growth,” Tibaijuka said.

Yara International of Norway president Joergen Ole Haslestad observed that another key to unlock Africa’s potential was to develop the agricultural sector.

“All of us have to accept and understand that farming is business,” said Haslestad.

The 20th World Economic Forum on Africa concluded in Dar es Salaam last Friday and 13 African heads of state and government participated together with more than 1,000 delegates from 85 countries. Rethinking Africa’s Growth Strategy was the theme of the meeting.

The next World Economic Forum on Africa will take place in Cape Town, South Africa from May 4 to 6, 2011.

Labels: GLOBALISATION, JAKAYA KIKWETE, RICHARD MAZOMBWE

posted by MrK @ 4:08 AM