30 January 2012
The economic decline of the developed North makes it crucial for African countries to increase trade among themselves and other developing countries, South African President Jacob Zuma told the New Partnership for Africa’s Development (Nepad) heads of state and government orientation committee meeting in Addis Ababa, Ethiopia on Saturday.
Zuma said the latest forecast from the IMF indicated that Africa’s economy would grow by over five percent on average in the next two years, he said, adding that economists from all over the world were predicting that Africa would be the next major growth area in the world.
“We all know that efforts to accelerate the development and structural transformation of African economies are hindered by very substantial obstacles, particularly those related to finance and infrastructure as well as governance, and human capital,” Zuma said.
“But we should not wait until all of these obstacles are resolved to create productive jobs. Other economies managed to expand production and exports while still grappling with the same sorts of constraints currently observed in Sub-Saharan Africa.”
Zuma said that traditional models of financing and delivering infrastructure had to give way to new models, with a particular focus on public-private partnerships.
$6.9bn needed to upgrade north-south corridor
Zuma told the meeting that billions of dollars would be needed to upgrade and maintain Sub-Saharan Africa’s north-south corridor, the road network forming the main trade route between Durban, South Africa and Dar-es-Salaam, Tanzania.
South Africa was appointed to lead Nepad’s presidential infrastructure championing initiative.
“In order to upgrade and maintain the north-south corridor road network, we will need US$6.9-billion, of which $4.5 billion is for capital investment and the remainder is for recurrent costs,” Zuma said.
“The entire north-south road network was physically assessed and inspected. With the exclusion of the road network in South Africa, the north-south corridor network that was assessed amounted to 8 600 kilometres.”
Increased intra-African trade ‘imperative’
There was already work under way to upgrade and maintain the road network in some parts of the corridor, Zuma said, adding that serious work was also needed to improve the continent’s rail infrastructure.
Zuma said increased intra and inter-regional trade was not an option but an imperative.
“Without trade, individuals, communities, countries and regions cannot reduce poverty or achieve economic growth.
“We have to challenge these issues, failing which our key differentiator to boost intra-regional trade will remain inadequate and perhaps a distant dream.”
Source: BuaNews
