Infrastructures and new technologies : how to accelerate investments in Africa?
Rarely has the world been this open to the circulation of goods and capital. For the longest time, the world has been split along ideological, confrontational and racial divides. But today, under the impulse of multilateral quorums such as the World Trade Organisation (WTO), the free market rule has triumphed as the sole one governing interactions among economic actors.
Amadou Niang, Minister for trade of Senegal
Hamidou Okaba, Director General for Economics and Fiscal Legislation, Ministry for Economics, Trade, Industry and Tourism of Gabon
Suk Joon Kim, Director of the Science and Technology Policy Institute
Michel Faivre-Duboz, Executive Director of Renault Morocco
Jean-Luc Bernard, Representative for Morocco, UNIDO
Louis Bedoucha, Program Director, MIGA-World Bank
Edwin Tsvangirai, Chairman of the Susan Nyaradzo Tsvangirai Fundation
The allocation of investments no longer takes place upon ideological or geographical criteria; it takes place solely on a merit base. Countries that receive the bulk of foreign funds are those that are able to create the adequate environment to welcome them.
Regulatory stability
Improving governance remains essential in creating the necessary trust climate for investors. Because of their unpredictability, political risks have always constituted a major obstacle for the development of investments throughout Africa.
The challenge for states has been summed up in the words of Edwin Tsvangirai, for whom it is not so much the quality of regulations but their consistency that matters most. Bad rules are better than no rules, if you know what to expect.
Consolidation and overcoming of national logics
Small domestic markets have no future in a globalizing economy. Mechanisms need to be found to force economic operators to consolidate. Only properly capitalized institutions that have reached a critical size will allow the capitalisation of know-how.
According to Senegalese trade Minister Niang, the political will to overcome national logics explains the success of Senegal’s “Strategy for Accelerated Growth”, that rested on two elements; on the one side, the liberalization of markets has allows the development of trade, widely recognized as the most efficient creator of wealth. On the other, regional integration has incentivized entrepreneurs to go beyond national markets, towards sub-regional and regional markets. As a result, Senegal trades today as much as 38% with Western Africa and 45,6% with the African continent at large.
A win-win partnership
Throughout history, know-how differentials have been the basis of a competitive edge on markets and competition. Today, African political leaders stress the necessity of rethinking know-hows no longer as a right, but as a product for which a market is necessary.
Know-how holders have to reap some benefits in this mechanism. They need to be given the means to partner with local entrepreneurs that want to improve their return and productivity. M. Okaba hence suggested to reserve a share of the capital of every company that wishes to acquire a know-how for the ones that are willing to provide it.
African development model
It is often said that Africa has a great opportunity in terms of developmental strategy; it only has to choose among the models that have worked throughout history and put them in place domestically. Panellists have insisted that in reality, neither the European experiences of the 18th and 19th century, which paid little attention to the environment and that were implemented in a relaxed international environment, nor the South-Korean experience, combining export-subsidy and budding industry protection, could be transposed in the current world trade environment.
The African development model remains to be invented. A sustainable and green economic development will no doubt be costly; A costs that can likely not be borne solely by the developing world.
