Africa and Asia reshape partnership for sustainable growth

Friday, 15 November 2013 00:39 - - {{hitsCtrl.values.hits}}

By Shabiya Ali Ahlam Over the past 10 years, the African region has blossomed and it is now certain that it will be a growth area of the future, despite the fact that growth and political stability will never be aligned in a consistent manner as there always will be ups and downs. J and J Group South Africa Executive Chairman Jayendra Naidoo, in a session titled ‘Africa and Asia: Reshaping Partnership for Sustainable Growth’, observed that over the years, it has been seen that to achieve stability and growth, countries need entrepreneurs to provide goods and services, and must invest in providing goods and services through partnerships. Achieving this, he said, is a challenge for all countries and governments. Necessary rebound At a time when the global economy has slowed down due to the Euro zone debt crisis, it is the emerging and frontier markets in Africa that have the highest potential for the necessary rebound, said Rwandan Minister of Finance and Planning Claver Gatete. In terms of learning from other countries, Gatete expressed that the growth of Asia has been one of the greatest success stories of the 20th century. He justified the statement by pointing out that countries such as Singapore and South Korea have seen their GDP rise greatly in the recent years. China too has seen its GDP increase from US$ 137 billion to US$ 8.35 trillion in 2012. “The rise of China has changed global trade drastically. In the recent years, we have seen a shift in power and politics. No matter where the economy has shifted, the impact it has had on human conditions is vital,” said Gatete. In 1990, the world had two billion poverty stricken people. 10 years later, mainly due to the economic transformation in Asia, the number reduced by half, thanks to the momentum from countries such as Singapore, South Korea and Malaysia to fight poverty through trade and investment. “Across Asia, the economic transformation has been a one-of-a-kind experience for prosperity cross the globe,” he said. In Africa, Gatete said that a story of hope is beginning to unfold. “When we entered the millennium, no one would have given Africa a chance. As I speak to you today, the situation in Africa continues to improve and the economy is growing stronger as more businesses are being established across countries. We have improved in terms of business communication, technology and also in embracing democracy,” he told audience confidently. Asia-Africa partnerships Nigerian Minister of Trade and Investment Olusegun Aganga opined that Asia-Africa partnerships is a subject of great importance to all since the last two decades have witnessed ever increasing trade and bilateral cooperation, people-to-people connections, FDI inflows, tourist activities, the exchange of high level visits, improvements in the ICT and technology, and increased investment opportunities in Africa and Asia. “Asia is the global economic hub and it is said to be leading in the ICT sphere. South Korea, India, China and Malaysia are good examples in this regard. On the other hand, Africa is on the rise and is believed to have most of the high-demand minerals and resources which will help take the global economy to the next level. If wisely developed, it will help turn the African economy into one of the leading economies in the world. And notably, the two continents have much more to share than ever before. We need to work as partners,” noted Aganga. When exploring areas where the two continents can form partnerships, the agriculture sector was pointed out to be a key area. However, more than half a billion hectares of land suitable for agriculture in Africa are underutilised, and to improve this, the region welcomes investors. Moreover, it was expressed that Africa has a lot to learn from its Asian counterparts on areas such as irrigation schemes, industrialisation, agricultural processing, intensification of productivity, commercialisation, mechanisation and value addition. Building up sectors From a private company perspective, Bharti Airtel India CEO/MD Manoj Kohli expressed that companies lucky to be based in the continents of Africa and Asia will prosper in the coming decades. To build and sustain partnerships between the two regions, Kohli said Africa can learn a lot from the Asian investment climate. “Building a climate to attract investments is a prerequisite for growth. The investments in Africa are still weak. They are not as good as they should be,” he said. Africa also will have to look at building various sectors in its region and for this, it could copy from Asia. “I think the amount of industry focus within each country in Asia is high. It embraced manufacturing, which is the base of Asia. This was followed by telecom and IT. In India, GDP growth of 9-10% actually happened only because of telecom and ICT. So, Africa has to adopt and develop only a few sectors,” stated Kohli. The other area that helped Asia become the growth engine of the world is its skills set, acknowledged Kohli. “The skills sets of small countries are fantastic, especially in terms of engineering, and that is where the development of Asia happened. And in this, Africa has to really pick up,” he added. Rapid growth Confident that Africa will continue to grow, Standard Chartered Bank Sri Lanka CEO Anirvan Ghosh Dastidar opined that the region will prosper simply due to the fact that it has a large middle income population. “We need to understand that this is a population of one billion. For all companies that are into retail, this is an exciting opportunity. Single digit inflation, FDIs reaching US$ 90 billion and the external debt falling under 23%, has allowed Africa to be listed as one of the world’s fastest growing economies,” he noted. Pix by Daminda Harsha Perera