AU think-tank advises strong state control over industrialisation projects in Africa
Yaoundé, Cameroon (PANA) - There is need for stronger state control over the private sector in the implementation of strategies geared towards kick-starting the industrialisation process in Africa, officials of an African Union specialised agency tasked with providing advisory services have affirmed.
Emmanuel Nnadozie, Executive Secretary of the Harare-based African Capacity Building Foundation (ACBF), an AU specialised agency tasked with providing advisory services to ministers of finance on mobilising resources for training needs, said the private sector cannot fire industrialisation without the effective control of the state to monitor the entry and exit of firms into the national economy.
“The history of industrialisation shows there is no way the private sector grows alone,” Nnadozie told PANA in an interview after hosting African ministers of finance attending the ACBF Board of Directors meeting to discuss the status of skills development around Africa, especially on resource mobilisation.
The ACBF was recently declared a specialised agency of the AU, tasked with promoting better economic governance and regional integration. Key among its tasks is to facilitate the implementation of the long-term strategic growth plan, the Agenda 2063 of the AU, which aims to promote faster industrialisation, trade and development across the 55 AU member countries.
Nnadozie said the entry and survival of the private owned companies in Africa depends largely on the management of the national economy and, therefore, the state governments have a major responsibility to ensure state policies promote the survival of the private-owned companies in the market.
“These policies should not be about subsidies. The national infrastructure should enable these private sector organisations and companies to move forward. The private sector should coordinate its productivity with the government,” Nnadozie said.
Nnadozie said economies in Africa require transformation to create jobs. The ACBF has made recommendations to African countries on how to bring good leadership changes to promote economic development which could result from the high economic growth rates being recorded.
He said putting the subject of capacity development at the top of the AU Heads of State and Government Assembly has elevated the level at which the subject matter is now discussed in Africa.
The role of the state in managing economies as well as state involvement in enterprise development remains a sticking point in debates involving the private sector and African finance ministers.
In a recent case study, an official from the finance ministry of the Democratic Republic Congo (DRC) regretted the negative cost of privatisation on the national government’s tax revenue.
The official said privatization of the state-owned cobalt firm, which previously financed the DRC’s entire budget from its 450,000 tonnes of cobalt exports, changed dramatically after privatisation with production increasing to 1.3 million tonnes, but contribution to the economy down to 20% from 80%.
This year, the ACBF launched its capacity development report, focusing on the need to promote social protection of vulnerable communities in urban and rural areas, promoting better economic management and deepening regional integration and better relations between Africa and the world.
According to Ghanaian Finance minister Ken Offiri-Atta, Chair of the ACBF Board, a new report on how states could better tailor their public policies to promote rapid economic transformation would be launched in July 2019 in Niamey, Niger, during the next AU Heads of State and Government Summit.
“The theme is to promote transformative leadership for Africa,” Offiri-Atta said at a recent board meeting.
“Africa needs transformative leadership for its Agenda 2063. The report defines transformative leadership which leads to the expected changes in social security and life expectancy.”
Offiri-Atta said enhanced social security and improved life expectancy in Africa remains a key requirement for long-term development efforts in Africa.
In his view, transformative leadership would inspire government officials to ensure transparency.
Offiri-Atta said the report highlights the leadership shortfalls in Africa and provides a clear index of the capacity required to lead to proper decisions to be taken on matters pertaining to the economy and industrial development.
“This report is a fruitful outcome of what is needed in Africa,” he added.
-0- PANA AO/AR 8April2019
