TRADE not AID is the answer for Africa’s prosperity

Panel Session 1: AfCFTA role in industrialization and development of Africa

Moderator: Anne Wambui Gaitha, CEO - Regal Africa Group

Panelists:

Hermogene Nsengimana; Secretary General -African Organisation for Standardisation

Waleed El-Zomor; Executive Director -New Start for Medical Tourism & Services

Yavi Madurai; Executive Director -The Pan African Business Women’s Association

Panel Discussion:

Waleed El Zomor kicked off the conversation with an appreciation of the role of the AfCFTA in boosting trade within the continent. The gap between value addition and production and trade of raw materials was pointed out as a barrier to trade. Mr. El Zomor pointed out that the continent was tasked to start the real work by engaging the rest of the continent and the world through the value addition of raw materials. He then encouraged nations to boost their competitiveness and improve logistics and infrastructure. The value of the integrated value chain through industrialization was also encouraged. His vision encouraged the expansion of trade outside regional blocks to grow the preferential base beyond the 12% of non-liberalized trade. He encouraged the three biggest economies of Nigeria, Egypt, and South Africa to come together and form a formidable mass that can face other regional blocks. The competitiveness of such a mass block would benefit other African markets as well. The multiplier effect of infrastructure was highlighted, with its role in access being amplified. He concluded by pointing out that the main obstacle to industrialization was the reluctance to add value to raw materials.

Hermogene Nsengimana began his contribution by stating that each nation, region, or trading block will go out of its way to get the most benefit out of any trade agreement, despite the AfCFTA. Other considerations affecting implementation will include the application and harmonization of standards such as that applied in the 1:1:1 principle. This allows one testing standard across borders, thus saving time and money. According to Nsengimana, conformity acceptance needs to be done at a continental level.

Trusted standards need to be achieved at all levels to allow seamless movement across borders without the need for retesting. He emphasized the need to set quality standards that should be embedded in the standardization during value addition. Certification should then be classified according to gold, silver, and bronze to guide consumers across the board. Ms. Gaitha reiterated the importance of standardization as a way of getting access and relevance in the global market.

Waleed El Zomor then unpacked the importance of medical tourism within the context of the AfCFTA agreement. He spoke of Africans spending about 6 billion dollars on healthcare outside the continent. Although he acknowledged that the continent could handle about 50% of these cases, he pointed out the challenge of the lack of protection of services from international partners within the continent.

“The health/service sector has a huge advantage. The first thing is because the sector is very well regulated but not really protected… A small amount of investment can also make a lot of difference,”

Waleed El Zomor

He encouraged partnerships where local medical personnel can learn from international partners. At the same time, the specialization of the medical workforce locally was also encouraged. Examples include, Kenya is famous for organ transplants while Egypt was well versed in cardiology. He encouraged these specialized countries to cooperate so that the treatment could be maintained within the continent at lower costs. Governments were encouraged to introduce a medical visa to promote medical tourism and establish centers of excellence in various areas. His final suggestion was the utilization of African nationals who had specialized in various medical fields across the world. Their contribution to the medical profession back home would enhance medical tourism.

The strengthening of regional blocks was the key to the implementation of the AfCFTA. These blocks were encouraged to focus on the creation of jobs, industrialization, and strengthening communication within the 8 regional communities. These would then be used as building blocks for a strong continental unit. This was Hermogene’s suggestion to the blocks as he challenged the continent to change its production patterns.

Yavi Madhurai joined the conversation by shedding more light on the role of technology. She explained how digital transformation can make a difference on the ground by changing the lives of billions of people in Africa. The start was the use of digital platforms to communicate and engage people with ease and lower costs. According to Yavi, technology has transformed the world of work and fast-tracked communication. Technology is expected to be the next accelerator of trade and services through the use of e-commerce platforms despite the challenges.

Yavi Madurai.

She called for a better process of communication and safeguard mechanism that will optimize the digital platforms and ensure that the digital advantage is indeed utilized. Addressing the digital divide to include those without access would also be an issue to address going forward. Yavi added the importance of formalization from a financing background. However, the use of technology to create structures was one of the things that needed to be embraced. Digital data capturing that conforms to the formal data structure would lead to better tracking systems.

Anne highlighted the need to embrace cash flow funding as opposed to collateral funding which is less feasible in the informal sector, in support of Yavi’s suggestion. Waheed encouraged the easing of regulations and the development of simpler regulations. Hermogene then clarified the assumption that he wanted the RECs dismantled. He instead encouraged their use as building blocks that would make it possible to build a bigger framework. His main issue was the overlapping of the different blocks which make operations difficult because of different regulations. Waheed then encouraged the enhancement of access to information so that it could be possible for traders to make informed decisions. Larger joint ventures were also encouraged.

Hermogene’s final take was that mobilization was the key to changing the mindset of the African consumer and trader. Yavi highlighted how difficult the implementation of the AfCFTA would be in the face of xenophobia. She concluded her final remarks by calling for a psychological drive of unity to help Africans change their mindset in a way that would affect their trading practices. The formation of a brand Africa agenda was the biggest game changer in Yavi’s opinion. Anne Gaitha concluded the session by reiterating the need to build trust by ensuring the standards of African brands are up to par.

Presentation: Wealth Creation in Africa Through Sustainable Trade Speaker: Anne

Wambui Gaitha, CEO - Regal Africa Group

Anne wambui Gaitha C.E.O

Regal Africa Group Speaker

Ms. Gaitha began by introducing the AfCFTA as the foundation of a borderless Africa and the development of restriction-free movement within the continent. She continued by illustrating that sustainable wealth creation was through trade, and highlighted the opportunities available for the trader beyond the local market. She encouraged regional continental and then global trade. The creation of African Brands was the key to forming structures to showcase brands that were trusted and would be easily consumed. The uptake of technology was encouraged as a way to do due diligence and enhance trade within the continent. Opportunities exist in food, beverage, fashion and beauty, flowers, and business services. Inclusive African transformation is dependent on economic transformation.

The shift of leadership to more women and youth was key in connecting to the grassroots and making changes that would fuel transformation. Anne then encouraged awareness of the diversity within the continent and the building of support within these consumable areas.

Supporting the business community will be key to creating employment. Wealth creation will then major on three factors. The first is to ensure good succession planning. The second is to have more community projects beyond the aid mentality. Community projects will have to have a commercial agenda with good management and resource sustainability. The third factor is better policies supporting the marginalized groups of society such as women and youth.

The improvement of infrastructure will also boost trade and fuel sustainable wealth creation. The government and the public-private partnerships are driving this agenda to fill this gap. Digital infrastructure will enhance digital trade and widen the market to traders and populations. Lastly, social infrastructure building through education will eliminate some setbacks through the dissemination of information. When combined with housing, water, and electricity to make it easier to exploit natural resources, then it will be possible to build sustainable structures to support trade. Anne also encouraged the growth of agriculture, the blue economy, and renewable energy through the engagement of the youth.

Formal entrepreneurship will create access to markets, affordable finance, and for capacity building. Creating generational wealth through entrepreneurship was the game changer transitioning the continent from aid to trade. Anne concluded by highlighting the availability of the Trade in Africa Program at the Center for International Trade. The service offers a platform where information is available and support is given. She also addressed John Bosco Kalisa’s concern about trade causing inequality. Anne equated the issue of scale as the barrier to growth and increased market share. She encouraged the formalization of businesses to create generational wealth that will attract investors, and bigger markets, and eventually close off the world gap of inequality. Collective prosperity is the way to build partnerships and scale businesses across borders.

Regina Moore’s question on AfCFTA partnering with monetary agencies on the generation of a common currency was also addressed. Anne Gaitha explained that the concept of an African currency was years to come. However, various countries were still trading despite currency differences.

Watch Anne’s Keynote Speech on RegalAfrica TV here https://youtu.be/WJ1t7L79aDQ