WEF

The future is in Africa

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The meeting convened more than 1 000 regional and global leaders from government, business, civil society and academia to explore new models to help Africa achieve success at a time when technology is creating dramatic economic and societal shifts

Speaking at the forum, Ngaire Woods, professor of Global Economic Governance at Oxford University, said he was worried that when AfCFTA is implemented, some poorer African countries may be crushed by stronger neighbours. He said there was need to ensure that Africa’s uniquely young population benefits when AfCFTA is implemented. More than 200 million of Africa’s population is aged between 15 and 24, he said.

“The consequences of liberalisation can really damage some of the poorest in these countries, but that’s not a reason not to do it, that’s a reason to have really great policies of support,” said Woods.

“We need to soften our borders to enable easy movement. We need leadership that is capable and has the determination to act collaboratively.”

Albert Zeufack, the World Bank’s Chief Economist for Africa warned that having a youthful continent is a huge opportunity, but a huge threat as well. “It’s a threat if we do not get that population to start really working.”

“I like to think of this AfCFTA as the most delicious African dish that can be produced,” said Arancha Gonzalez Laya, Executive Director of the International Trade Centre. “The ingredients have been assembled, the cooks are in the kitchen. The guests are impatiently waiting for this dish to be served.”

The “dish” is vital for the 200 million young Africans aged 15-24 who need to see the continent move up a gear to a higher level of economic growth if they are to secure jobs and contribute to their countries’ prosperity as the workers of the future.

Sipho Pityana, Chairman of AngloGold Ashanti, said the free trade deal is a “catalyst”. He said it was now up to political and business leaders to implement the removal of trade barriers and ensure sufficient investment in infrastructure and logistics to truly accelerate cross-border trade flows.

“We need to soften our borders to enable easy movement,” Pityana said. “We need leadership that is capable and has the determination to act collaboratively.”

An entire session was devoted to the theme “Delivering the Promise of Africa’s Youth”, at which the president of Botswana –whose 18% jobless rate is still far below South Africa’s 27%–called youth unemployment “scary”.

However, South African President Cyril Ramaphosa, is optimistic about the ratification of AfCFTA, and believes it will be utilised to good effect.

“The future is great, it looks very bright for the African continent, and if there was ever a time when Africa can definitely be said to be on the rise, this is the time,” he said.

In a panel discussion at the forum, Reserve Bank Governor Lesetja Kganyago said Africa had a positive economic outlook, even though some countries were still showing little or no growth.

“I think that what we’ve seen for this year and next year’s outlook is that this continent will continue to grow faster than the world average. That is the good news,” Kganyago said. He, however, cautioned that a big risk was rising debt levels among some countries, including South Africa, which had received debt relief, mostly from the private sector.

Peter Attard Montalto, a columnist at the Business Maverick, said South African businessmen were not as enthusiastic at this year’s forum as they have been at previous forums.

He said business was happy to come along to World Economic Forums in previous years and play the best ‘TeamSA’ role. “But business was having none of it this year and there was no sense of TeamSA,” he said, adding that there was a distinct lack of buzz.

“Acts of xenophobia are deplorable. They have no place in the modern world. Xenophobia is parochial and counterproductive. It ought to be condemned.”

Montalto said the absence of a large number of foreign delegations from business up to presidential level was partly to blame. “The xenophobic violence in recent weeks caused a number of withdrawals, but even before that, fewer names than usual had registered to attend. As a result, many sessions seemed poorly attended and applause was muted even in the more full sessions,” said Montalto.

He said business sentiment in SA is currently so weak that executives were far more interested in talking about what was going on in the rest of Africa than in South Africa. Most African economies are growing at a rate much faster than South Africa’s. Consequently, South African companies have an opportunity to expand into those markets. This is not good for South Africa at a time it desperately needs more investment.

Standard Bank which operates in 20 African countries, is particularly sensitive to any developments that suggest other Africans are not welcome in South Africa, said Kenny Fihla, chief executive, corporate and investment banking at Standard Bank.

“Acts of xenophobia are deplorable. They have no place in the modern world. Xenophobia is parochial and counterproductive. It ought to be condemned,” Fihla said.

The Nigerian government decided at the eleventh hour to pull out of the World Economic Forum (WEF) in Cape Town, South Africa, following xenophobic attacks on Nigerians and other foreign nationals in Pretoria and Johannesburg. Vice-President Yemi Osinbajo was billed to speak at the summit, but also pulled out on the day the summit started.

Sandile Hlophe, (partner and Africa region government and public sector leader at Ernest and Young) said when it comes to immigration, South Africa needed plans which can be implemented immediately. One of these is the streamlining of visa applications. “That’s something we can fix tomorrow,” he said.

Dr Martyn Davies managing director of emerging markets & Africa at Deloitte said the political economy of South Africa expected a V-shaped recovery after the end of the Zuma era, but that had not been the case.

“We’ve moved from structural decline to drift,” he said. “We’re tired of drift. We need action. We need leadership. We need a strong state. If we get our act together, we can turn on a dime,” Davies said.

The plan has three core priorities, which include to work with the technology industry to deploy a free emergency response system for women under attack in SA’s nine provinces, support women entrepreneurs as a means of promoting economic empowerment, and establish a fund to help support South Africa’s gender-based violence strategy and action plan.

“I’ve been in DRC twice in the last few months. We have a vaccine, we now have a treatment - and yet, some communities are not willing to accept those interventions.”

Another notable outcome was the launch of a new foundation by the African Union, in partnership with the World Economic Forum, to pave the way for the private sector to help build capacity and resources to strengthen health security across the continent.

The forum heard that 16 of the 20 global countries with lowest levels of trust in medical experts are in Africa. It’s a problem particularly for countries such as Democratic Republic of Congo which is dealing with an outbreak of Ebola.

“I’ve been in DRC twice in the last few months. We have a vaccine, we now have a treatment - and yet, some communities are not willing to accept those interventions,” said Jeremy Farrar of the Welcome Trust, the health charity that conducted a global survey on attitudes towards vaccines.

If epidemic-prone African countries slide towards ‘“vaccine hesitancy” to the levels seen in France, the consequences could be catastrophic, said Priya Agrawal of vaccines maker MSD. “We need to enable scientists to talk about science in a way that makes sense for the public,” she said.

Other notable outcomes at the forum include the following:

  • The launch of an innovation challenge by the World Bank and the Forum, in partnership with African governments, with the aim of finding new ways of using drones across Africa;
  • Partnership between the Forum and Ghana in implementing the Global Plastic Action Partnership which aims to combine public- and private-sector resources to tackle plastic pollution and unmanaged waste (The partnership is the first signed with an African country, following an initial partnership signed with Indonesia earlier this year), and
  • Five private sector partners announced 23 million U.S. dollars in new pledges for the Global Fund’s Sixth Replenishment (donors include Goodbye Malaria, Project Last Mile, GBC Health, Zenysis Technologies and Africa Health Business.)
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