African economy outlook

BY FOLAWIYO OLAJOKU
The African Development Bank’s annual meeting came to an end on the 25^th of May 2018 and the theme for the meeting was accelerating Africa’s industrialization.

The meeting was held in Busan, South Korea which is the second largest city in South Korea. The republic of Korea (South Korea) joined the African Development Bank (AFDB) in 1980 and has been one of the banks most active and generous partners.

The theme of the AFDB 53^rd annual meeting was, “accelerating industrialization in Africa”. Is Africa ready? That was the thought that brazed through my mind during the AFDB annual meeting. Where is the infrastructure or the enabling environment to enable industrialization take place in Africa? Does the political will exist?

The world is moving towards the 4^th industrial revolution where the jobs of today won’t be the jobs of the future. The question is are we in Africa entrenched with the skill set or education to move into the 4^th industrial revolution? Even the 5^th industrial revolution is almost here – the quantum leap. The future of money is cryptocurrency. What understanding or polices can be drawn to fit the constant change in the world terrain? Can Africa leapfrog and achieve the 4^th industrial revolution? Yes, it’s possible.

Investing in people (Human Capital) is key in achieving steady economic growth and industrialization in Africa. Education and Health must be invested in and not left to donor agencies, we cannot place a price on education, the world is changing at a sporadic pace and Africa has continued to maintain the same educational curriculum when the world has continued to evolve. If Education is given the right priority, our universities will not produce half-baked graduates but graduates who can compete globally and the need to invest in ideas is key in the actualization of an industrial Africa.

We have seen youths in Nigeria, Kenya, Rwanda, Zambia just to mention a few thrive amidst the stringent bottlenecks of the African economy. Africa is blessed with vast human and natural resources, but the missing link is education. Fear of the 4th revolution is the loss of jobs, since Africa already faces mass unemployment, how can Africa pull through from this? Through investments in education and harnessing entrepreneurial skills. Also, Africa is known for the export of raw materials but not finished products.

We export cocoa but not chocolate, we export crude oil and import petroleum products, we export raw gold and its sold back to us in the refined form. Its amazing that the price of chocolate never goes down but up, but the price of cocoa fluctuates, why then are we not tapping into the huge market of finished products? African policy makers should also enable and encourage young people in agriculture to export and supply finished products to bring that value back to Africa, because Africa still has a huge comparative advantage in Agriculture.

African policy makers should focus on key priority areas for the attainment of the 4th industrial revolution in Africa such as domestic savings, infrastructural investment, revenue attached to development, finance small/startup businesses, investment in education and health as well as tax revenues and transparency.

Olajoku has Ph.D in Development Economist