Africa urged to focus on job creation, value addition

14:37, May 01, 2011      

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Africa must start measuring its economic growth in terms of job creation and the progress of value addition of what it produces rather than the gross domestic product (GDP) if it has to move from vision to action, analysts say.

Marcus Courage, managing director of Africapractice Group, a development communication consulting group, said Africa requires "inclusive growth."

"One of the challenges is that we measure economic success in terms of Gross Domestic Product (GDP). That is not a fair reflection of action. We need inclusive growth in Africa. We need to focus on value-addition to create jobs and further boost growth, " Courage told Xinhua in a recent interview.

Speaking ahead of the World Economic Forum on Africa to be held in early May, Courage said even high GDP does not necessarily mean better lives for all the people.

Charles Robertson, the global chief economist and head of macro- strategy at the investment bank Renaissance Capital, said Africa should take advantage of the forthcoming World Economic Forum on Africa in May.

"I notice the priority they (World Economic Forum on Africa) focus on is creating sustainable development," he said.

Analysts believe the forum should be able to generate ideas on revitalizing agriculture in the continent.

They say African countries should seek to create public private partnerships in order to accelerate food production, manufacturing and general development.

When the World Economic Forum on Africa was held in Tanzania last year, seven companies have signed private public partnerships with government agencies to meet the private sector investments needs in agriculture that was found to be lacking in Tanzania.

Bernard Katompa, the chief executive officer of Liberty Africa, an insurance company, said both the private and public sectors should focus on creating value in their economy.

He said for instance the insurance industry is creating value through coming up with policies that are affordable to majority of the population to ensure low income earners also are covered in case calamities to enable them not to get in poverty cycle every time they face a financial problem. "There is value to be created for our company. The East Africa region has a population of 160 million and the penetration is very low creating a huge opportunity to bring products into this market. East Africa has a huge potential," he said.

Mbithe Muema of the investment bank Renaissance Capital in Nairobi said Kenya for example has taken the lead role in spreading the access to financial services across the East Africa region through expansion of its banking and insurance companies. "Kenyan banks are all actively looking to expand into the broader East African region, with focus on the markets of Tanzania, Uganda, southern Sudan and Rwanda. The usual reasons of lower penetration, bigger population and marketplace, and higher margins have been touted, as well as the need to follow key customers who move to new markets. Many have made moves, but there have been no exceptional success stories to date in terms of bottom-line delivery," he said. The World Economic Forum is an independent international organization committed to improving the state of the world by engaging leaders in partnerships to shape global, regional and industry agendas.

Source: Xinhua

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