Andy Kusi-Appiah & David Kilgour: Africa prospects in the year 2015

Andy Kusi-Appiah

Andy Kusi-Appiah

Andy Kusi-Appiah is the founder of SkillFocus, an Ottawa-based soccer development program for elite athletes, and has also served as head coach for elite teams in both Ontario and Quebec (1995-2010).  He is also the co-founder and CEO of the Canadian Education Management Agency.  Andy was the senior advisor on diversity issues to Mayor Bob Chiarelli, and has also served on numerous advisory committees and Task forces at the City of Ottawa. Andy is a professor at Carleton University.

David Kilgour

David Kilgour

David Kilgour is co-chair of the Canadian Friends of a Democratic Iran, a director of the  Helsinki-based First Step Forum (www.firststepforum.net), and New York-based NGO Advancing Human Rights. He is a former MP for both the Conservative and Liberal Parties in the south-east district of Edmonton and has served as the Secretary of State for Latin America and Africa, Secretary of State for Asia-Pacific and Deputy Speaker of the House and chair of committees of the whole House.

Africa prospects in the year 2015

by

Andy Kusi-Appiah & David Kilgour

 

“I feel good….” (James Brown):

Feeling good was James Brown’s mantra throughout his life. He felt good about his music; He felt good about himself; He felt good about his community….but James Brown did not feel good all the time, because good can be radical as eloquently put by Hannah Arendt.

As we begin a new year, I feel good about Africa’s collective prospects….and that is a radical feeling!

I feel good about Africa’s continued cordial relationship with Canada (Canada’s relationship with Africa is now one of economic diplomacy, even in the presence of an epidemic scare). The new strategy, according to Minister Ed Fast, will “ensure that all of the Government of Canada’s diplomatic assets are harnessed to support the pursuit of commercial success by Canadian companies and investors.”, and even so at a time when Africa’s economic outlook couldn’t be better.

According to the World Bank (2014), African economies continue to expand at a moderately rapid pace, with regional GDP growth projected to strengthen to 5.2% yearly in 2015 from 4.6% in 2014 (compared to a modest 2.3% for Canada for the same time period).

Even though Republic of South Africa’s economy (Africa’s second largest economy) slowed due to structural issues and low investor confidence, economic activity was notably strong in Nigeria, Africa’s largest economy (GDP increased by 6.5% in the second quarter of 2014, up from 6.2% in the first quarter), and other countries in the region followed the Nigerian trend, with Cote d’Ivoire, Ethiopia, Mozambique, and Tanzania recording strong increases in economic activity.  Cote d’Ivoire, for example, had a strong increase in rice and cocoa production to boost agricultural growth and sustain the country’s high growth. Ethiopia also continued with robust growth supported elegantly by agriculture and investment in infrastructure.

Growth fueled by agriculture and service sectors:

Africa’s growth has been fueled primarily by the agricultural and the services sectors, which have been more effective in reducing poverty than growth in industry. In a special study of Africa’s patterns of structural transformation and poverty dynamics, World Bank’s new Africa’s Pulse finds that the region is largely bypassing industrialization as a major driver of growth and jobs. Instead, the study says, extractive industries in the natural resources sector and a surging services industry are propelling Africa’s growth. The majority of Africa’s jobs continues to be in agriculture and is surging into services – but not into industry and manufacturing”, says Punam Chuhan-Pole, a World Bank lead Economist for Africa and co-author of Africa’s Pulse. 

Africa at the mercy of declining commodity prices:

The above trend is expected to continue in 2015.  However, declining commodity prices will also continue to be a significant issue for the region, as primary commodities continues to account for over 75% of the total goods exports.

Another significant issue for Africa’s economic outlook is high inflation, notably in Ghana. In most cases (e.g., Ghana and Zambia), the fiscal position has remained weak due to increasing current expenditures, especially outrageously high wage bills (i.e., ghost names on the public sector pay roll), and in some cases weaker revenues. Large fiscal deficits are also reducing fiscal buffers and affecting these countries’ ability to respond to exogenous shocks, such as the current Ebola outbreak in parts of the West African sub-region.

Diversification to the rescue:

Diversification of economic activities in Africa may be the key to sustaining the momentum created by the consistent economic growth outlook.  Tourism is a growth industry which could be easily organized and nurtured to bring jobs and revenues to the state.

In 2014, countries such as such as Ethiopia, Kenya, Mauritius, Seychelles and Tanzania continued to make inroads in the tourism sector.  However in countries such as Cape Verde and Namibia, tourism was adversely affected as tourist arrivals from Europe declined. In Cape Verde tourism receipts slowed even though occupancy rates increased, pointing to competitive pricing pressures in this most important sector, which, together with related industries, represents 30% of GDP.

Strong political and economic governance needed:

Strengthening political and economic governance in Africa could significantly contribute to narrowing economic and social inequalities. Since 2010, Africa has witnessed an increasing number of free and fair elections, and the trend is expected to continue. Despite a bumpy start, Tunisia just consolidated democratic gains with the enactment of the national constitution in early 2014, and subsequent free and fair elections in December 2014.  However, progress in other North African countries affected by the Arab Spring uprising has been slow. Relative peace in the Horn of Africa has been blighted by reports of civil conflict in South Sudan while the crisis in the Central Africa Republic risks deepening fragility of the region. 

Ebola and other internal challenges remain:

Other important challenges remain. In Africa, income inequality, vulnerability to economic and social risks, as well as self imposed environmental hazards continue to threaten and derail the very foundations of public infrastructure in the region.

While Nigeria’s economy is currently considered to be strong, the Boko Haram crisis (the formation of a branch of Boko Haram in Ghana is worrisome – see Daily Heritage newspaper of Ghana, December 22, 2014 edition) as well as the proverbial lack of accountability across all social strata runs the risk of derailing any economic gains made in the recent past.

Needless to say, there is a complete breakdown in security in most African countries, and many terrorist groups keep springing up here and there terrorizing citizens frequently and with impunity.  Peace and security breakdowns in the Central African Republic and South Sudan for instance, have resulted in the tragic loss of lives and livelihoods. There are other hot spots as well, and these could make it impossible for the economic gains to be sustained into the future. A strong commitment from Africa and the international community is required to help address these crises.

The Ebola crisis that hit parts of West Africa in 2014 has not abated. As of December 24, 2014, over 7,500 people had lost their lives from the virus. The first case across the border was confirmed a few days after the World Health Organization (WHO) officially declared the outbreak on 23 March 2014. But it was not until August 2014 that the virus really took hold in the capital Monrovia, a densely packed and notoriously poor city in the Montserrado district. Throughout September 2014 the county was reporting more than 200 new cases each week.

It is important to note that Monrovia is home to around one-fourth of Liberia’s total population, and the majority of its residents are crammed into rubbish-strewn slums, many of which are built on low-lying swamps and are unconnected to a municipal sewage system.

Poor hygiene & unsavory sanitary conditions, a time bomb:

Sadly, the above scenario is a common feature in most cities in Africa – public sanitation leaves much to be desired. Reports on the Ebola crisis indicate that weak public goods and services, coupled with lack of resources in health care centres stymied the battle to combat Ebola in West Africa.

The main reason for the lack of resources partly relates to the presence of weak public institutions which operates in an environment where corrupt practices are not frowned upon, let alone prosecuted. This culture of corruption makes it increasingly possible for officials (both government and non-government) to embezzle funds meant for the provision of public goods and services, leading to a situation in which public institutions (including schools, hospitals, health centres, roads, etc) lack the necessary resources to cater to the needs of citizens.  In the future, the building and maintenance of public goods and services must be given priority, for epidemics and future accidents would be quickly addressed if such public goods and services are in place and working efficiently.

In the meantime, Canada has committed over $110 million in health, humanitarian and security contributions to help fight the spread of Ebola. The Government of Canada has also provided in-kind support and donations of the Canadian-developed Ebola vaccine.

The Government of Canada has partnered with the Canadian Red Cross as part of a campaign to recruit more Canadian workers. The “Join the Fight Against Ebola” campaign is currently recruiting for Ebola Treatment Centres in Sierra Leone, Liberia and Guinea. All Canadian healthcare workers, including those who work for the federal government, are encouraged to apply.

The Government of Canada is also actively engaged and committed to supporting the global effort to combat Ebola virus disease. Canada is currently monitoring the Ebola outbreak by working with international partners including World Health Organization (WHO), United States Centers for Disease Control and Prevention, and Global Public Health Intelligence Network.

Efforts are being coordinated with the United Nations Missions for Emergency Ebola Response (UNMEER) and through experienced partners within the United Nations system and the International Federation of Red Cross and Red Crescent Societies (IFRC).

One cannot forget the contributions of African Diaspora who remit to their family and friends in Africa on a daily basis. In fact, such remittances compete favourably with Canadian aid funds.  According to Professor Adams Bodomo of the University of Hong Kong “One way to draw more remittance funds to Africa is to involve Diaspora Africans more in the political system of the countries towards improving good governance. African governments must not pay lip service to the incorporation of these development agents and financiers that these Diaspora Africans are in the governance and national decision making process.”

Africa’s outlook going forward looks good; however, what is needed is vigilance on the part of the people of Africa.  Things get done when people work at making things happen 2015 holds a lot of promise and hope, however, hope alone is not a strategy!

 

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