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Mr President of the Republic of Burkina Faso, Mr Roch Marc Christian Kaboré
Minister of Foreign affairs of Morocco, Mr Salaheddine Mezouar,
Excellences, Ministers ambassadors
President Mohamed El Kettani, and dear friend, out host today
Dear colleagues
It is always a pleasure to address such a prestigious floor at this now “must attend” African rendezvous. Every year, the African family convenes in Casablanca, for the fifth year now, to reflect on African growth avenues, on co-development opportunities, and also on ways to address common challenges such as creating jobs, reducing poverty and lowering inequality.
Growth opportunities are endless in a land of promises. Our continent stands to benefit from:
- Arable lands and the largest reserves of natural resources in the world;
- A developing market of 1.2 billion consumers and a youthful population;
- A great potential for growth;
Yet, each year 12 million young people enter the labour force market.
Half of them remain unemployed !
Growth in Africa does not have a significant impact on jobs creation and living standards improvement.
On the other hand, our overall growth performance is undergoing a worrying slowdown.
In this chart, illustrating 15 years of growth in Africa, we can clearly see the sustained decline. Over the last 10 years, the African economic growth lost more than one point. On a 15 years’ period, the loss was ... almost 3 points
Ladies and Gentlemen,
Africa must shift its paradigms to achieve sustainable and inclusive growth. The need to improve the lives of African people and the necessity to drive Africa into international competitiveness should fuel our discussions and motivate our ambitions.
In 2050, our population will reach 2,4 billion, 60% of which will live in urban areas. The pressure of jobs creation, food security, housing and social protection will be higher.
States, governments, businesses and civil society need to join forces and act for change; and this change, in my opinion relies on a few key drivers:
- New and strong industries;
- Good governance;
- Skilled human capital;
- Adequate business environment;
- And, last but not least, Regional approach
1- New industries
The share of industry in African GDP barely reaches 10%. Africa does not transform enough and does not create enough value !
Most African economies are still based on unprocessed natural resources and the industrialization pace is slow.
- Africa will always rely on Agriculture to face the challenge of food security, but we will need a green revolution: higher productivity of agricultural land and agribusiness development.
It is a non-sense to keep importing processed food while land, water and mild climate are available, and while our businesses can meet this demand!
Governments need, in turn, to adopt a green revolution roadmap. They will have to address issues relating to industrial property, adequate logistics and markets organization.
Africa can also bring its own industrial revolution through renewable energy and the new green economy. This will improve our electric capacity and allow the emergence of a green entrepreneurial ecosystem.
Although many initiatives were taken in more than 30 countries: Solar and wind power in North Africa and the Sahel region, hydroelectricity in Central Africa, geothermal power in East Africa, Africa uses today only 10% of this potential.
To speed up the process, heavy investments are needed and the private sector, alone, cannot finance this long-term profitability projects. PPPs are necessary as well as a clear vision and a stable legal framework.
- Infrastructure and Housing also offer opportunities for inclusive growth:
o Housing deficit in Africa exceeds currently 30 million units. Needless to remind that 200 million Africans still live in slums.
o …and the next 10 years, infrastructure investment needs for Africa are expected to reach 500 billion US dollars
Building the Continent infrastructure and houses will ensure the use of local resources and help address the challenge of unemployment.
While the private sector can rise to this challenge, and has proved to be able to do so, governments need to ease access to land, access to finance, and provide a sound regulatory framework.
- Digitization will forge the future of our economies. And this is not an option. Who would have imagined, 20 years ago, that 60% of Africans would have a mobile phone and a quarter of them would be connected?
It has happened !
Digitization will greatly impact the way our businesses will be conducted and will also offer tremendous opportunities to create new types of businesses. In China, for example, eight million entrepreneurs, one-third of whom are women, use e-commerce platforms to sell their products domestically and to export them to 120 countries.
Governments will have to cope with this trend and reinforce e-government initiatives.
2- Good governance
The second driver for an inclusive growth is governance. Economic development should be considered as the top priority of our government policies and effective mechanisms should be put in place to promote such an objective.
To ensure inclusive growth, we will have to consider promoting entrepreneurship, gender equality and involving the private sector in public policies’ design.
We, the business community, need a real public-private partnership, where governments act as facilitators and regulators, and companies create responsible growth and shared wealth.
3- Skilled human capital
The third driver, and may be the most important one, is human capital. 70% of the population of sub-Saharan Africa is under the age of 30.
Yes, Africa’s real asset is its population! But how can our youth contribute to build Africa’s prosperity?
Education and training will, undoubtedly, help reach this objective:
- Today there is a real need to redesign education curricula and to rethink education approaches in order to meet the requirements of the private sector;
- On the other hand, vocational training should be enhanced to improve the competitiveness of the SMEs, that are the backbone of our economies
- And finally, we need to spur entrepreneurship and innovation spirit among youth and facilitate business creation.
4- Improve Business environment
The fourth driver, is the business environment. In the 2017 “Doing Business” ranking, 30 out of 54 African countries still lag behind ! Business climate is one of the main causes of growth divide in Africa.
Lack of regulation, difficult access to land, weak investment protection and redtape hinder productive investment.
5- Regional vision
Last but not least : can we envision Africa as powerful regions rather than individual countries ? Yes We should ! My colleagues whom I asked to give their ideas on how to achieve inclusive growth, highlighted the need, to act local, to think regional.
When addressing agriculture, agribusiness, energy, mining or other industries, the focus should be, therefore, on our complementarities.
And this is the mindset that should prevail. The business community, that we represent, suggests the creation of regional Centers of Excellence, each one specializing in the industries we are best at.
This, regional approach needs also to rely on more intensive regional trade. Only 12% of trade in Africa occurs between countries on the continent. In comparison, intra-regional trade is 24% in ASEAN, 40% in North America and 60% in Europe!
Ladies and gentlemen,
These were some ideas on how to restore Africa’s growth. We must all commit to change. For us, business community, change means socially responsible investment, local value and more jobs.
But above all, there is something we all must have: FAITH. Faith in Africa, faith in its people, faith in its future.
Please allow me to pay tribute to all African entrepreneurs, hundreds of them, who invested in Africa and made change happen. We are proud of you !
Thank you for your attention