AU sees state policies leading to major shift in intra-Africa trade
Yaoundé, Cameroon (PANA) - The European Union (EU) has become the biggest loser in the latest international trading trends observed by an African Union Commission research team, which shows exports mostly from East African countries to the Euro zone dropping by a massive 20%.
However, trade among African countries expanded by 18% from 12%. American goods are now dominating African markets while Asian countries have effectively replaced European goods in Africa, Dr Ligane Sene, AU Economic Policy Research Officer, said on Tuesday.
While addressing the Specialised Technical Committee (STC) on Finance, Monetary Affairs, Economic Planning and Integration, taking place 4-8 March 2019, Dr Sene said public policy shifts had made it possible for the major shifts in the regional and international trading trends, but challenges remained.
The STC, which brings together ministers of finance and economic planning, has been convened to review various economic policies which could help to re-ignite economic growth and promote integration within Africa, which is gearing for the major opening of a continental trade platform.
Sene said unequal wealth distribution remains within Africa, which consistently records an average growth rate of 4.6% while future growth is projected to rise to 7.2% annually.
In order to address the major economic challenges facing most African countries, Dr Sene said it was important for government officials to concentrate efforts on addressing non-monetary indicators of poverty.
Such indicators include low-levels of education, school dropout rates and lack of access to healthcare facilities as opposed to low-income if the rate of economic production is to be increased.
The Economic Affairs officer, whose task was to brief the ministers on the public policies required to achieve economic growth which would later impact on poverty as well as create employment, noted that the manufacturing sector in Africa has traditionally had the highest potential to reduce poverty.
Sene said the manufacturing sector remains at its infancy stage across Africa. At the same time, efforts to transform the manufacturing sector have remained weak because the resources availed have often been unmatched with nature of production required to obtain results.
The AU officer recommended measures should be in place to improve the flow of trade information, which is a crucial step in ensuring the governments of Africa can re-allocate funds and labour to obtain results from the manufacturing sector, especially in Africa’s fabrics industry, which is growing.
Sene said it was still regrettable that the fabrics industry in Africa failed to grow into an expansive sector because it lacks the required technology and sophistication required for going global.
He said the biggest share of African economic gains were in the services sector which accounted for larger segments of the local economy while North Africa had the best-performing manufacturing and industrial sectors, which could be tapped by the rest of Africa.
“The challenge is to increase industrial productivity to make a difference where the reference to exports is a by-word for economic productivity,” Sene emphasized.
-0- PANA AO/MA 6March2019
