UN, AU foresee another financial crisis, call for transformative policies

T he United Nations and the African Union have warned that the risk of another financial crisis cannot be ignored in Africa as they call for transformative policies as panacea to the current economic headwinds.

The two bodies acknowledged that African current growth has not generated sufficient jobs, and has not been inclusive enough to significantly curb poverty. “Fluctuations in commodity prices have made such growth vulnerable.

This reminds us of the imperative to structurally transform that in our case focusing on the potential offered by industrialisation”, Carlos Lopes, UN Under-Secretary-General and executive secretary of the Economic Commission for Africa (ECA), said in Addis Ababa, Ethiopia.

Speaking at the high level ministerial segment of the conference of ministers at the ongoing Africa Development Week, in Addis Ababa, Lopes said in 2016, with a barrel price of US30.8, Africa is going to earn US47.1 billion less in trade surplus this year, relative to that in 2015.

The difference is around 8 percent of the total value of Africa’s exports in 2014. Africa’s total foreign debt has been higher than 30 percent of GDP since 2010 and was projected to have risen to 37.1 percent by themed of 2015.

Making a statement at the meeting, Nkosazana Dlamini Zuma, chairperson of the African Union Commission, urged the ministers to support the growth of African private sector, including facilitating entrance into new sectors such as the green and blue economies, as critical part of the industrial policies.

“We must continue to push for integration. The reality is that the cost of non-integration is growing”, she said.

However, to achieve the universal electricity in Africa, an estimated annual capital investment of US50-100 billion will be required by 2050 on climate change. Hickey Iyambo, Vice President of the Republic of Namibia who said this while addressing the ministers also said to achieve Sustainability Development Goals (SDGS) in Africa annual capital investments of US$55 billion will be needed until 2030, US$93 billion on infrastructure until 2020, US$26 billion for universal education by 2020, and US$31.5 billion minimum for healthcare.