Reimagining Africa’s Economic Growth: Insights from Okonjo-Iweala
Ngozi Okonjo-Iweala, Director-General of the World Trade Organization, emphasized the imperative for Africa to bolster trade and investment in value-added goods and services to stimulate economic expansion. Speaking at BusinessDay’s Africa Trade and Investment Summit, themed ‘Reimagining Economic Growth in Africa,’ she underscored the need for an enabling external environment and a predictable internal economy to drive this transformation.
Okonjo-Iweala highlighted that African businesses face significant trade costs, equivalent to a 354 percent tariff among the world’s cheapest, hindering their competitiveness. Additionally, intra-African trade faces trade costs equivalent to a 435 percent tariff, underlining the challenges within the continent. To overcome these barriers and accelerate growth, she stressed the importance of increasing trade and investment in value-added goods and services.
Despite Africa’s underperformance, accounting for only three percent of global trade, Okonjo-Iweala sees potential for growth by shifting focus from raw materials and commodities to value-added products. She emphasized the necessity of reimagining global trade and investment, capitalizing on Africa’s growing young population and regional integration through initiatives like the African Continental Free Trade Area.
Highlighting the opportunities presented by the rapid growth in services, particularly in tech-savvy sectors like fintech, Okonjo-Iweala emphasized the need for more supply and value chains in Africa to integrate into global production networks. Successful re-globalization, she argued, would enhance growth, job creation, and supply resilience.
Okonjo-Iweala stressed the importance of a supportive external environment and an open and predictable internal economy for African countries to achieve these goals. She called for agreements that would facilitate this process and encouraged investors to diversify their portfolios to include African markets.
In his welcome address, Frank Aigbogun, Publisher of BusinessDay Media, echoed the sentiment of Nigeria and Africa being at a crossroads, emphasizing the need to focus on actionable steps to realize their potential. He underscored the importance of giving hope to the people by fostering economic growth and development across the continent.
Overall, Okonjo-Iweala’s insights shed light on the challenges and opportunities for Africa’s economic growth, emphasizing the need for strategic initiatives and partnerships to unlock its full potential on the global stage.