In recent years the continent has made some significant strides in all dimensions of economic and human development, comparable with other regions in the world on similar economic trajectories having registered fast-growing economies in a constrained global economy. Industrialization in Africa cannot be considered a luxury, but a necessity for the continent’s development. Without strong industries to create jobs and add value to raw materials, African countries risk remaining shackled by joblessness and poverty. This economic transformation can happen by addressing certain priority area across the continent.
African industrialization has to focus on the regional market through increased trade before it extends to the global supply chain, with emphasis on agro-processed products and value addition mineral export. The question is: how should Africa pursue industrialization?
African government individually and collectively, must develop supportive policy and investment guidelines. Clearly defined rules and regulations in the legal and tax domains, contact transparency and macroeconomic stability are essential to attract long-term investors.
Moreover, incentives- such as tax rebates to multinational companies that provide skills training alongside their commercial investments will help local economies grow and diversify; each industrial policy should be tailored to maximize a country’s comparative sector-specific advantages.
African continent must pursue beneficial economic strategies with their neighboring countries. Regional integration would reduce the regulatory burden facing African industries by harmonizing policies and restraining unfavorable domestic programs. This would boost and accelerate industrialization.
Agriculture could become a spring-board towards industrialization. It can provide raw materials for other industries, as well as promote what economists call backward integration in which a company connects with suppliers. Sustained investment and improvements in infrastructure are also needed throughout the continent. Countries everywhere, not just in Africa, cannot establish competitive industrial sectors and promote stronger trade ties saddled with substandard, damaged or non-existent infrastructure.
Africa is ready for industrialization, a strong and positive growth trajectory. Rapid urbanization, stable and improving economic and political environments have opened a window of opportunity for Africa to achieve economic transformation.
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Written by Amina Martha.