Radical economic transformation will drive inclusive growth in Africa.
President Jacob Zuma, addressing delegates to the World Economic Forum on Africa, says growth cannot be achieved by only a few stakeholders in the economy.
“The youth in particular have been very clear in calling for leaders to address issues of exclusion, poverty and unemployment,” he says.
“They are important stakeholders for us because Africa is a youthful continent. This means we are a continent that has a very bright future if we invest correctly in our young.”
African leaders in the past have not adequately addressed how the continent can close the gap between the rich and the poor in the world to achieve meaningful inclusive growth.
“The gap between the developed and developing worlds remains huge. And the gap between rich and poor in many countries also remains wide.”
African development can only be achieved if each country is allowed to grow its economy according to its own abilities, and without conditions being imposed, Zuma adds.
“In working towards facilitating inclusive growth and prosperity, the continent has a number of issues to resolve, many of which we are already addressing.
“We talk about radical economic transformation, which in our view will take us on the path to inclusive growth and a better life for all.”
Infrastructure development remains top of the agenda, Zuma adds, along with the promotion of regional integration and intra-African trade. Other focus areas include agriculture and the blue economy.
“In SADC, we have decided to prioritise industrialisation, especially through labour-intensive manufacturing to promote job creation.”
Access to finance is critical for Africa to develop, and Zuma says countries need to mobilise domestic resources through taxation and other means, while also working to reduce illicit capital flows.
African countries must also take the radical step of diversifying our economies away from commodities, so we are less vulnerable to commodity shocks, he adds.
To achieve these goals, and others, Africa needs to strengthen developmental partnerships between government, business and labour, Zuma adds.
“We have decided to take control of our own destinies. Our people are yearning to change. We have a clear roadmap towards inclusive growth and a better life.”
The world is undergoing massive changes, and Africa is not immune to them, says Klaus Schwab, founder and executive chairman of the World Economic Forum.
“The first global challenge we have to confront is the fourth industrial revolutions,” Schwab says. “This will change in fundamental ways how we produce, consume and live.”
The fourth industrial revolution will hit us with the force of a tsunami, he adds. “I argue that the dividing line of the future is no longer left and right. It is those that embrace the future, embrace new opportunities, embrace openness, and those who look back, who struggle in the present.”
Africa has an advantage with its youthful population, Schwab says. But we have to arm them with the tools that will allow them to embrace the fourth industrial revolution.
Conflict tends to waste energy, he adds, but consensual societies will be more able to embrace the fourth industrial revolution.
The second global challenge is what is known as “the new normal”. This relates to slowing GDP growth rates, which leads to more youth unemployment challenges, Schwab says.
With most of the world’s youth population living in Africa, solutions to unemployment are needed – and this requires trust in the soundness of the institutions, trust in democracy, and accountability.
The world is experiencing a crisis of leadership, Schwab says, and this is the third challenge.
“People are living in precarious situations so the present situation cannot be maintained. They want fast solutions, and there are populists who exploit this.”
A good outcome is predicated on returning to value-based leadership, he adds. “This leads us to responsible and responsive leadership.”