A GHANAIAN official has urged African countries to complement foreign direct investments (FDIs) with intra-regional investments to boost the prospects of intra-continental trade, reports Koku Devitor.
Reginald Yofi Grant, Chief Executive Officer (CEO) of the Ghana Investment Promotion Centre (GIPC), made this call, Wednesday during the maiden Annual Assembly of African Investment Promotion Agencies (IPAs).
Grant said intra-African investments would enable countries to invest in critical areas in sister countries to boost the performance of specific sectors related to trade to drive trade under the African Continental Free Trade Area (AfCFTA) initiative.
‘Africa is a continent full of potential, and AfCFTA is an important key to unlocking these potentials. Unleashing continental opportunities requires prioritising issues, channeling interventions in the right direction, and removing barriers in vital sectors,’ Grant said.
He pointed out that currently, Africa accounted for just 2.3 percent of global exports, with an export basket heavy on primary commodities and natural resources and only 16 percent of these exports were traded regionally.
‘Africa consistently lags behind other continents on internal trade with itself. Strengthening regional trade is, therefore, crucial to supporting greater value addition, diversifying supply chains, boosting resilience to crises, and industrialisation,’ he stated.
Grant said the low rate of intra-regional trade on the continent was partly a reflection of the low intra-regional investments.
‘But indications are that intra-regional trade would promote value addition and ultimately increase the continent’s share in global trade since much of its trading with itself was in semi-processed and processed goods,’ he added.
Ultimately, Grant said strengthening intra-regional trade would contribute to job creation and better livelihoods on the continent.
For AfCFTA to succeed, he said the continent must attract more FDI inflows and promote intra-African investments.
Africa’s FDI inflows reached $83bn in 2021, from $39bn in 2020, accounting for 5.2 percent of global FDI. As of 2017, the stock of intra-Africa FDI stood at $52bn, or 11percent of the Africa’s total FDI stock.
‘Colleagues, what it would take for Africa to trade more and invest more with itself, I believe, is cooperation and collaboration. The time is ripe to chart a new path in the African FDI story. We must embrace this opportunity and work tirelessly to realize the goal of an economically emancipated Africa,’ Yofi urged.
Representatives of the African IPAs, their colleagues from the World Association of Investment Promotion Agencies, and some political leaders attended the maiden meeting to discuss the critical roles of IPAs in boosting intra-African trade.
The participants also discussed the emerging opportunities from AfCFTA and how various development actors could leverage these opportunities to facilitate trade on the continent and boost socioeconomic development.
Officials from Liberia, Zimbabwe, Namibia, Nigeria, Kenya, South Africa, and many other African countries were present at the meeting.
Ismail Ersahin, Executive Director for the World Association of Investment Promotion Agencies (WAIPA), was among the many dignitaries at the meeting hosted by Grant, who is also the Sub Sahara African Director on the steering Committee of WAIPA.