UNCTAD 2013 economic report focuses on private sector enhancement to boost intra-African trade

11 Jul 2013

image(Right to left) Mr. Taffere Tesfachew, Director, Division for Africa, LDCs and Special Programmes, UNCTAD Mr. Eugene Owusu, UN Resident Coordinator and UNDP Resident Representative, Ethiopia. H. E. Dr Mothae Anthony Maruping, Commissioner for Economic Affairs, African Union Commission

‘Developmental regionalism’ should be the new approach that African countries adopt in order to boost regional integration, recommends the Economic Development in African Report 2013, launched on Thursday, 11 June 2013 in Addis Ababa. The report also recommended learning from other regions and countries to encourage regional value chains in Africa.

According to Mr Tasfachew Taffere, Director in the Division for Africa, LDCs and Special Programmes, UNCTAD, the theme of the report was motivated by recent firm decisions of the African Union to boost intra-Africa trade. He  stressed however that African countries must change their approach to regional integration and focus on action oriented regional projects and avoid unrealistic goals if they want to achieve their objective of promoting intra-Africa trade.

This year’s United Nations Conference on Trade and Development (UNCTAD) report highlights the importance of engaging the private sector in trade consultations with respective governments and increasing manufacturing capacities; in addition to enhancing private sector’s ease of access to financial resources, often quoted as an obstacle to trade development. While promoting intra-African trade unlocks opportunities for sustainable economic growth and poverty reduction, a number of pending hindrances need to be addressed, argues the report. Some of these include: infrastructural improvement and domestic workforce enhancement through entrepreneurship. It should be recalled that the UNDP in Ethiopia is greatly contributing to Ethiopia’s entrepreneurial development, particularly through the establishment of the Entrepreneurship Development Centre, officially opened earlier this year. Moreover, the report emphasizes the need to both diversify and increase product output, recognizing the increasing demand for goods across the continent, as another potential way forward in relation to growing intra-African trade.

The report supports raised arguments by presenting analytical facts on current statuses of regional trade across Africa. For instance, compared to other regions such as Asia for the same period, Africa’s 11 per cent intra-trade levels is no match for the former’s 50 per cent. However, Africa holds about 27 per cent of the world’s arable land, which creates opportunity for expanding agriculture, a viable commodity for intra-African trade. 

Speaking at the launch, UNDP Ethiopia Resident Representative, Mr. Eugene Owusu disclosed that the ‘UNDP/RBA recognizes the importance of strengthening Africa’s trade and it has been providing support by implementing a three year trade project ‘Building African capacity to gain maximum benefits from inclusive globalization and regional integration’ with African Union Commission since 2008.’ While commending the political will behind regional integration in Africa, Mr. Owusu observed that, “For five decades now Africa’s intra-regional engagement has been, almost exclusively, and traditionally driven by politicians. I would now challenge that the time may be ripe for the African private sector to captain the ship and stir us towards more regional integration.”

On positive achievements registered thus far, the report also commends the decision undertaken by African leaders in January 2012 to remove identified barriers to intra-African trade which has suffered great reduction during the period between 1997 and 2011 (from 22.4 per cent to 11.3 per cent respectively).

A number of international and local journalists attended the event which has received sizeable coverage in the media. Delegates from a number of development partners such as Austria, Japan and Spain were present, as well representatives from key Government of Ethiopia institutions as the Chamber of Commerce and the Ethiopian Development Research Institute.

 The UNCTAD report launch was moderated by H.E. Dr. An­thony Mothae Maruping, Commissioner for Economic Affairs at the African Union Commission.