There is the need for governments to balance between mobilizing financial resources for economic development and controlling indebtedness to sustain growth.
According to the “Foresight Africa” Report on top priorities for African continent in 2019, one key risk threatening the regional outlook was the fear of a looming debt crisis.
The Report, launched in Accra by the Africa Center for Economic Transformation (ACET), was conducted by the Africa Growth Initiative (AGI) at Brookings Institutions, an independent research organisation that helps establish long-term strategies for economic growth and strong policies for development in Africa.
Dr Brahima Sangafowa Coulibaly, a Senior Fellow and Director of the AGI at the Brookings Institution, said the report was one of their flagship reports they release every year.
He said until a year ago, they had an updated strategy to come to the continent after launching it in Washington, to get reactions from various stakeholders and inform their research agenda going forward.
Last year, they did it in the Africa Development Bank in partnership with the Economic Unit and in Nairobi and this year they chose Ghana and South Africa.
He said last year after the Brookings, they did a poll of their constituencies to find out what they thought was the top priorities for Africa in 2019, majority thought good governance and leadership was the most important issue that Africa should tackle this year followed by health and education, economic development, peace and security, among others.
He said most people thought gender and youth inclusiveness would be at the top but he believed that with good governance, one could take care of the rest.
“So this year we choose Good Governance as our theme, last year it was on Leadership,” he said.
The report deals with six chapters including Bolstering Good Governance, Managing Debt and managing Resources, Harnessing Africa’s Youth Dividend, Fixing Fragility, Africa’s Untapped Business Potential and Boosting Trade and Investment.
The report said Africa has failed to industrialize because industries in Africa face highly productive but relatively low wage competitors and has declined as a share of output and employment at all levels of development over the past four decades.
This, the report said, suggests that Africa might not be able to rely on industry to lead structural change to the extent that it did in East Asia.
Thirdly, the Growth of Value Chains (GVCs) brings both opportunities and challenges to specialize in a limited set of tasks suited to each country’s capabilities, but they play a strong premium on trade logistics, an area in which Africa’s economies have not excelled.
Finally, the share of natural capital in Africa’s aggregate wealth is the second-highest in the world and resource-abundant economies facing strong headwinds in industrializing.
“The same forces that limit Africa’s opportunities in industry, however, are also creating a growing number of tradable services such as tourism and remote office services, and agribusinesses including horticulture that shared many characteristics for manufacturing, especially the capacity to create better jobs,” the report said.
It said between 2002 and 2015 exports of tradable services and agribusiness increased as a share of non-mineral exports by an average of 58 per cent.
First published by GNA