Industrialisation, low fertility rate critical to Africa’s growth -Experts
Industrialisation, and low fertility rate is critical to the growth of Africa and can lead to at least 6-10 percent growth annually, experts at the ongoing Africa Business Convention 2022 have said.
“For Africa to experience a 6-10 percent growth, it will require industrialisation, education, population control and electricity,’’ Charles Robertson, Global Chief Economist, Renaissance Capital said during the conference.
Robertson also explained that there is a link between growth, low interest rate and low fertility rate. “We have seen that countries like Morocco with low fertility rate and low interest rate are leading industrialization in the world. Bangladesh, which had the same population as Nigeria as in 2008 is also seeing the same trend.”
According to Fertility forecasts, Nigeria, Tanzania, Angola and Ivory Coast will continue to have the world’s highest real interest rates until 2050 because bank deposits are unlikely to jump.
Peter Quartey, from the institution of statistical, social and economic research, University of Ghana, also pointed out that Africa needs Industrialisation and value addition to grow. “Many African countries have become import dependent, less productive and are consuming more. We need to transform the industries in Africa, that’s where we will find the jobs.”
“With the African Continental Free Trade Area (AFCFTA), we have a larger market. We should be able to produce at a reduced cost but our products need to be differentiated and with a good quality. This is the only way we can benefit from the trade,” Quartey said.
Africa’s growth has not been sustainable. Quartey explained that this is because Africa has not learnt to account for global shocks when drawing up development plans.
“We have also been dependent on commodities such as oil, we need our economies to diversity away from commodities,” he said
On where Africa would see the most investment in the coming years, Ben Liewellyn-Jones, British Deputy High Commissioner for Nigeria said a lot of investments will be going towards renewable energy and technology.
“We encourage businesses to look away from oil and gas into areas such as technology, fashion and music. There would be opportunities but people must build digital skills to be able to engage with the digital economy and be a part of it.
Robertson also explained that Foreign Direct Investment (FDI) will only go towards the rich and healthy market but the Fintech space will continue to attract a lot of Finance.
Liewellyn-Jones also pointed out that the challenge of attracting Investment in Africa is familiarity. “People cannot invest in an environment they are not familiar with and don’t understand.”