‘African countries must form strong trade ties to survive global shocks’
Do you think the business climate on the continent is still attractive to Foreign Direct Investment (FDI)?
One would think that in an unstable environment, where we have unstable currency and lax economic discipline, African economies needed to rethink their attractiveness, especially as the last 50 countries in the World Bank Ease of Doing Business Index are traced to the continent. Out of the last 50 countries, 36 of them are Africans. So, if we compare the average ranking with that of South America or Asia, the average South American country is ranked 45th while those in Asia are ranked 25th. African countries are ranked 63rd, so there is really a lot of room for improvement. And it is going to be all the more important now, as the commodities are not helping anymore.
How do you think Nigeria, as the giant of Africa, can surmount these challenges?
I think Nigeria is at the crossroads. People think that oil is going to be permanently sold at a low price because we are entering an energy transition period. That would have to force Nigeria to rethink what its assets are.
Diversification has already started in the last decade in Nigeria, but clearly, it is not enough. We think Nigeria has to live up to its promises now because it has fantastic human capital; its one of the biggest markets in sub-Saharan Africa. The country has grown a class of entrepreneurs that a known all over Africa. I think everything is in Nigeria’s capacity to prove its worth, but the new government has to show the world that it is serious about macroeconomic discipline, fighting corruption and that it is attractive in other areas other than oil and gas.
What would be the major challenges for the continent this year given the continual fall in oil prices?
I think there are three to four main objectives: First, African countries have to stay attractive. In the last decade, Africa has shown the rest of the world that it has the capacity to grow and create success stories. So, now, the rest of the world is seeing Africa as a market, and the most important thing is, Africans have started to believe in themselves. We have grown big companies into successful ventures. We need to keep going at it.
The second is to keep the money flowing. The mild economic challenges we are seeing now are creating the risk that may see capital flow slowing.
That is one of the themes of the forum this year, how to better mobilize local African capital.
The third one is for public officials to keep to the promises they have been making in the last five to six years. They have talked about investing in areas where we can be leaders, such as renewable energy. We believe that Africa has the potentials to be a powerhouse in this sector. We also have agriculture too. We have been hearing for many years that Africa has the potential to lead in agriculture. We need to solve this desperately. We also need to move on to industrialisation.
What has been the most significant contribution of the Africa CEO Forum over the years to making businesses on the continent better positioned to meeting the challenges of global trade?
At every conference, we survey our participants and ask them what they are getting from the conference. Last year, we had 87 per cent of the participants saying that they identified a business opportunity within the conference.
The conference brings CEO together from across Africa and we believe that every year that passes by, the CEOs get to know each other better and they help in integrating businesses in the continent.
Since its creation in 2011, it is indisputable that private sector conversation is now one of the priorities of all governments and we think that the Africa CEO forum has been helping in achieving that goal.
What is your assessment of the Africa Rising narrative against the backdrop of trade agreements by African countries that impede growth and slow the rate of industrialisation?
It is a very delicate question because we have different types of trade agreements, depending on the different regions of Africa. Most probably, on the question, we have to stop talking about Africa as a whole; w
For example, Ethiopia has been one of the success stories of industrialisation in Africa. If we look at Ivory Coast, for instance, they have been successful in trying to get cocoa producers or exporters to produce locally. Here and there, there are stories that are arising. This shows that if Africa wants to industrialise, she can. But I have to say that it is major issue and Africa is still lagging in this context.
What sort of agreements do African countries need to implement to open up their borders and boost trade?
In French-speaking parts of Africa, the markets are too small to be part of the growth story of Africa. So, promoting intra-regional trade would be a great growth enhancer. We have seen what it has done for the East African community, which is a good example of how intra-trade can help foster growth in an area. I think the Economic Community of West African States (ECOWAS) has a lot to learn from the EAC to achieve this goal. That is what we are trying to do slowly at the Africa CEO Forum by helping the regions to engage in this conversation. We would have for the first time, the president of Kenya who would travel for the time in French-speaking Africa. He would be holding a conversation with the president of Ivory Coast on this subject.
What do you intend to achieve for the 2016 edition of the conference and what informed the decision to shift the venue from Geneva to Abidjan?
We initially created the forum in Geneva because we wanted to showcase to the world the strength of African capitalism. And in order to do that, we had to be outside of Africa in an international venue. We also wanted to get rid of the divide between French-speaking and English-speaking countries. So the best way to do this at that time was to have the conference outside Africa
Now, after three editions, we want to have the fourth one, which has a strong following of CEOs, who have become familiar and have gotten used to meeting with each other. We thought it was the right time to hold the conference in Africa. And with the return of the Africa Development Bank (AfDB) in Abidjan, which is our partner, we selected the city to be the first host of the forum.
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