Panafrican News Agency

Think-tank emphasizes better economic rule in Africa

Addis Ababa, Ethiopia (PANA) - African countries should maintain strict controls of their economies and free off currencies pegged to the Euro to escape the worst effects of the eurozone debt crisis, a continental economic think-tank has proposed.

Bakary Kone, the External Affairs Manager at the Harare-based African Capacity Building Foundation (ACBF), said the effects of the eurozone debt crisis was being felt in Central and West Africa, due to the direct link between the euro and the franc.

“Africa has to maintain strict control of their economies. There are currencies pegged to the Euro, especially the countries in the CFA franc zone. It means their currencies appreciate without anything related to economic fundamentals,” Kone told PANA.

Kone said the West African nations must be assisted through investment in the basic manufacturing facilities to stop the export of their raw materials.

“We grab our cocoa and ship it to Europe. The fruit and cocoa butter give you a 10-15 percent (profit) margin. Some countries have been warned and have started creating basic industries to start industries to make cocoa butter,” he noted.

In the interview, after signing an agreement with the Ethiopian finance ministry to become a full member of the ACBF, Kone said sound economic policies would lead to better economic governance and help reduce poverty in Africa.

The ACBF currently funds 29 thinktanks in Africa to implement policies to improve youth employment, promote research and innovation and to revamp economies.

“We want Africa to formulate policies that help take our countries forward to the next level,” Kone, an Ivorian economist, said. “We are going nowhere exporting our raw materials. Countries need to develop by research and innovation.”

Kone said ACBF was currently working to promote innovation through science and technology and was concerned less emphasis was being laid in the field of research.

“We need support for the innovations. It is not that we are rich in gold and platinum. It is what you plan to do with the platinum,” he noted.

Meanwhile, Kone regretted that in 2008, when the world went through the financial, food and economic crises, there was a false feeling that most economies resisted the effects of those shocks, while in actual fact, the impact was huge.

“Why is everyone saying Africa resisted better? Most countries tightened their regulations. There were clear efforts to focus on the priority sectors of the economy," he said.

Kone said most countries should learn from the American experience that "only countries that invest in research and development like the US lead in economic development.

“The US alone has 1,840 think tanks and the richer, the greater the number of thinktanks.

“Well-managed economies are based on decisions based on fact. Let us study the consequences of the decisions because the best programmes can fail because the decisions are not acted upon. We must make sure that the skills are built but institutional capacity is also built. The institutions are impossible to sideline.”
-0- PANA AO/VAO 7Feb2012