6 minute read
Industrialisation in Africa
By Shumirai Chimombe
Industrial development is of critical importance for sustained and inclusive economic growth in African countries. Industry can enhance productivity, increase the capabilities of the workforce, and generate employment, by introducing new equipment and new techniques. Industrialisation, with strong linkages to domestic economies, will help African countries achieve high growth rates, diversify their economies and reduce their exposure to external shocks. This will substantially contribute to poverty eradication through employment and wealth creation - United Nations
The African Union (AU) Agenda 2063 was declared by Africa’s leaders in May 2013 as Africa’s ‘blueprint and masterplan for transforming Africa into the global powerhouse of the future’. It encapsulates seven aspirations for the future as well as flagship programmes that have been identified to boost Africa’s economic growth and development, leading to rapid transformation of the continent.
These aspirations include continental and regional integration; inclusive social and economic development; democratic governance; and peace and security - all aimed to reposition Africa to becoming a dominant player in the global arena. The Agenda 2063 highlights industrialisation and manufacturing as being among the sectors that are key to driving socio-economic growth and development.
Aspiration 1: A prosperous Africa based on inclusive growth and sustainable development
Transformed economies and jobs
• transforming Africa’s economies through beneficiation from Africa’s natural resources, manufacturing, industrialisation and value addition, as well as raising productivity and competitiveness
The African Continental Free Trade Area-creating a unified continental market
The African Continental Free Trade Area (AfCFTA), which was adopted in 2018 as one of the flagship projects of Agenda 2063, has put into motion this emphasis on industrialisation. The highly ambitious trade agreement aims to progressively bring together all 55 member states of the AU, covering a market of more than 1.3 billion people, creating a unified market for goods and services across the continent.
This will unlock vast manufacturing potential, accelerate industrialisation and increase investment. It will also reduce trading challenges such as different regulations from one African country to another, and red tape. Twelve countries, including South Africa, have finalised their legal modalities for the agreement. This opens the way for trade to begin in thousands of products ranging from food and beverages to steel products and equipment, taxis, pharmaceutical and personal care products, chemical products and household goods such as fridges and televisions.
Infrastructure - connecting borders
The AfCFTA has already opened up significant infrastructure investment opportunities as participating countries will need to prioritise building infrastructure in particular, road transport, as this is the most preferred mode of transport for the movement of goods, services and passengers.
The Department of Trade, Industry and Competition has said that the SADC countries have adopted the Regional Infrastructure Development Master Plan that prioritises the development of road, rail and ports.
The plan identifies 72 road projects comprising new builds, upgrades or maintenance projects and includes the Dar es Salaam-Chalinze toll road (Tanzania), the Beitbridge-Chirundu road upgrade (Zimbabwe), and the Kazungula Bridge. The plan is being implemented over three five-year intervals and has led to the completion of some of the infrastructure in the region.
The Kazungula Bridge was completed and opened in 2021. The bridge runs through the North-South corridor and is jointly owned by the Botswana and Zambian governments. The opening of the bridge reduced pressure on the Beitbridge border crossing between South Africa and Zimbabwe and transit times between these countries.
Buy local - boosting local manufacturing
The African Union High-Level Panel on Emerging Technologies (APET) encourages African countries to increase private sector investments in industrial development, stating that economic growth can be achieved through prioritising domestic manufacturing centred around commodities.
A viable approach for accelerating industrialisation in Africa is through the adoption of Import Substitution Industrialisation (ISI), according to APET.
ISI is an economic policy that aims to reduce imported goods, and eventually replace them with domestically produced alternatives. The results: self-sufficiency in the manufacturing sector; stimulating domestic production; leveraging natural resources and talents, and expanding employment opportunities.
Several African countries have implemented ISI strategies and campaign interventions to boost their local manufacturing sectors. These strategies encourage citizens to buy locally-manufactured goods, leading to increased support for domestic industries.
Africa Industrialisation Day is commemorated on 20 November each year to raise awareness around the world about how industrialisation plays a critical role in the continent’s development. The Organisation of African Unity (OAU), the forerunner to the AU, declared this day during its 25th Ordinary Session in Addis Ababa, Ethiopia in 1989 to highlight the importance of industrial development for Africa’s economic growth and prosperity.
Now celebrating its 35th anniversary, the theme for this year is “Leveraging Artificial Intelligence (AI) and Green Industrialisation to Accelerate Africa’s Structural Transformation”.
The theme focuses on emerging technologies such as AI and innovations in green manufacturing and how these can be leveraged to accelerate Africa’s industrialisation in a sustainable manner.
Some key focus areas and objectives in the spotlight include:
Building stronger policy advocacy around leveraging AI and green industrialisation for Africa’s sustainable development
Highlighting strategies and best practices to harness the power of AI to boost productivity and efficiency across industrial sectors in Africa
Promoting investments in AI solutions that can help grow and transform key industries in Africa
Facilitating knowledge sharing between policymakers, industries, academia, civil society and development partners on integrating AI in production systems.
Exploring collaborative initiatives between the public and private sector for increased funding in AI research and development for industrial applications
Showcasing innovative use cases of AI and green industrialisation by youths and women entrepreneurs in Africa
Formulating policy recommendations and actionable strategies for mainstreaming AI and green industry in Africa’s industrialisation planning and development agenda
“For Africa, AI is a strategic asset pivotal to achieving the aspirations of Agenda 2063 and the Sustainable Development Goals (SDGs). It promises to ignite new industries, fuel innovation, and create high-value jobs while preserving and advancing African culture and integration” - The African Union (AU)
