Removing impediments to the movement of goods and people around Africa is critical for economies to develop, according to a panel on the Future of
Trade at the World Economic Forum (WEF) on Africa in Cape Town, South Africa.
According to participants at the forum, just 12 percent of African countries’ total trade is within and the continent only accounts for 3 percent of value addition in global trade.
Because Africa’s economies are mostly small, regional collaboration is needed to justify the high cost of infrastructure spending to create regional value chains and to allow skills to move across borders, said Fatima Haram Acyl, commissioner for trade and industry, African Union, saying “we need to take a more holistic approach,” Michael Rake, chairman, BT Group, United Kingdom, and co-chair of the WEF on Africa, said the free movement of labour had benefited the European Union, but had also created political tensions between countries.
In his view, Yonov Frederick Agah, deputy director- general, World Trade Organisation (WTO), said “Africa needs to do more to integrate itself into the global trading system in an era where trade preferences are being eroded and competition is increasing.
This requires looking at the competitiveness of domestic environments, building infrastructure and managing external factors that have an impact on trade.”
It is critical that the Doha Round is finalised as it would make the trade environment more stable for Africa, he said. Also speaking, Jean-Louis Ekra, president/chairman, board of directors, African Export-Import Bank, Egypt, emphasised the need for African countries to add value to their exports.
For example, Africa’s cocoa producers cannot trade the commodity with one another, but they can process the cocoa and trade chocolate within the continent.
More than 1,250 participants took part in the 25th WEF on Africa in Cape Town, South Africa, which held between June 3 and 5.
The theme of the meeting was “Then and Now: Reimagining Africa’s Future.”