Lead Economist at the African Development Bank Group, Dr George Kararach says African countries need to devise and implement a long term diversification strategy in order to attain the transformation of their economies.
Kararach was speaking during the Department of Trade, Industry and Competition’s (the dtic) Trade and Investment Knowledge Network Dialogue, which was held virtually in partnership with Brand South Africa.
The session was convened with the aim of creating a platform to facilitate an exchange of knowledge and ideas on how to jump-start economic growth through stronger investment and trade partnerships, as many nations undertake a post Covid-19 journey to economic reconstruction and recovery.
Kararach said for too long now, efforts to expand trade and investment in Africa, had been geared towards primary commodities rather than diversification. He added that more work needed to be done by governments in the continent to foster an environment that prioritises the development of human and social capital.
“Such an environment would encourage individuals and organisations to develop their own capacities to actively participate in the global economy. African countries need to encourage the emergence of quality institutions to ensure the effective implementation of sustainable trade and investment programmes and policies through reforms in areas such as education, tax and labour regulations, as well as financial sector among others,” said Kararach.
The Director of Export Development, Promotion and Outward Investments at the dtic, Mr Thulani Mpetsheni told the meeting that global economic recovery would be accelerated by population vaccination. He presented findings of a recent study commissioned by the dtic which revealed that South Africa’s exports declined at an average of 2.2% between 2010 and 2019 with mining, beneficiation, automotive, chemicals and plastics as the key export sectors.
“South Africa is only outperforming global competitors in only two sectors, chemicals and
oceans industry with Compound Annual Growth Rate of 1.5% and 7.6% respectively. South Africa needs to identify key markets and establish superior value propositions for its exports to out-compete other countries,” he added.
Ms Duzuzile Mpyana, from the Trade Policy, Negotiations and Cooperation Branch, speaking on matters relating to the African Continental Free Trade Agreement (AfCFTA), mentioned that AfCFTA was integral to the developmental integration approach underpinning the Africa’s structural transformation agenda in Agenda 2063 – the Africa We Want.
She emphasised that the Rules of Origin Criteria as mentioned under AfCFTA were powerful instruments towards promoting African industrialisation by ensuring specific products originating in Africa qualify to receive preferential tariffs under AfCFTA.
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Bongani Lukhele – Director: Media Relations
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Issued by: The Department of Trade, Industry and Competition (the dtic)
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